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Silver Bullion 

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$ 1.29 

ONE OUNCE , 


PRICE MINTING 


Marketing and Merchandising of 

Silver Bullion 


CHICAGO 

1923 








2 . 


Copyrighted, 1923 

BY 

W. P. HALLOKAN 


ALL RIGHTS RESERVED 



0CI "9 ^ 




INTRODUCTION 



HIS work presents accurate information concern- 


A ing the price, the minting, the marketing, and the 
merchandising of silver bullion. This work places be¬ 
fore the silver producer the fundamental and elemen¬ 
tary principles that apply to the use of silver bullion 
as a monetary merchandise. 

The writer will consider his efforts amply rewarded 
if they call the attention of the silver producer, allied 
and associated interests, as well as the financial and 
the mercantile world, to a sane and common sense 
view of everyday facts on silver bullion. 


Yours for silver bullion, 


Argentum Signatum. 

W. P. H. 



* 





CONTENTS 


CHAPTER PAGE 

I. Price of Silver Bullion, 1786 . 7 

II. Price of Silver Bullion, 1792 . 11 

III. Price of Silver Bullion Today . 14 

IV. Troy Pound. 18 

V. Silver Bullion—The Money of Account.... 23 

VI. Barter . 28 

VII. The Word Dollar. 36 

VIII. Silver Dollar—Scotland. 43 

IX. Silver Dollar—Sierra Leone . 46 

X. Silver Dollar—London Bankers, 1804 . 47 

XI. Silver Dollar—London Bankers, 1864 . 51 

XII. Silver Dollar—London Bankers, 1876 .... 59 

XIII. Silver Dollar—London Bankers, 1895 . 63 

XIV. Silver Dollar—British Government, 1903.. 68 

XV. Silver Dollar—Imperial China, 1910 . 75 

XVI. Silver Dollar—Bepublic China, 1912 . 77 

XVII. Silver Trade Dollar—Japan, 1877. 80 

XVIII. $6.46 or 5 Dollar Unit of Silver Bullion.... 82 

XIX. The Bight to Mint Silver Bullion. 85 

The Silver Bulletin . 91 





























CHAPTER I 


Price of Silver Bullion, 1786 

J ULY 4, 1776, the colonies declared their indepen¬ 
dence. After peace was declared, the first Congress 
of the Confederation met, July 6, 1785, and one of the 
first subjects that occupied its attention was the mint¬ 
ing of silver and gold bullion. This Congress enacted 
the first law in the United States which relates to the 
mint division or price of silver and gold bullion. 

The subject of the law was a name for the weight 
of silver bullion to be issued as the mint unit, and on 
this question, that the name for the weight unit of the 
United States Mint be one dollar , the yeas and nays 
being required by Mr. Howell; every member answer¬ 
ing ay, it was resolved that the silver weight unit of 
the United States of America be named one dollar . 

This is the first law passed by Congress where the 
word “dollar” is recognized and authorized to be the 
name for our mint weight unit of silver bullion. 

The reader must keep in mind the fact that the 
number of grains of silver bullion to be contained in 
the unit had not been determined nor authorized. No 
mint had been established, yet we have the word “dol¬ 
lar” authorized as the name for the mint weight unit 
of silver bullion. 

On August 8, 1786, thirteen months after selecting 
the name for the mint weight unit, by a report of the 
Board of Treasury, Congress 

Resolved, That the standard of the United 
States of America for gold and silver shall be 
eleven parts fine and one part alloy; 

7 







8 


SILVER BULLION 


That the money unit of the United States being 
by resolve of Congress of the 6th of July, 1785, a 
dollar shall contain of fine silver 375.64 grains— 
409.78 grains standard; 

That there shall be two gold coins: One con¬ 
taining 246.268 grains of fine gold equal to 10 dol¬ 
lars, to be stamped with the impression of an 
American eagle, and to be called an Eagle; 

One containing 123.134 grains of fine gold equal 
to 5 dollars, to be stamped in like manner, and to 
be called a Half-Eagle. 

Pay particular attention to the next law: 

That the mint price of a troy pound weight of 
uncoined silver bullion, 11 parts fine and 1 part 
alloy, shall be 9 dollars, 9 dimes and 2 cents; 

That the mint price of a pound of troy weight 
of uncoined gold, 11 parts fine and 1 part alloy, 
shall be 209 dollars, 7 dimes and 7 cents. 

Ordered, That the Board of Treasury report a 
draft of an ordinance for the establishing of a 
mint. 

This is the first law in the United States that fixed 
the prices for silver and gold bullion. And from that 
day, August 8, 1786, all that Congress has ever done or 
can do is to authorize the number of grains of bullion 
that shall be contained in the mint unit. What these 
mint weights or dollars will purchase depends entirely 
upon trade conditions. 

In regard to silver, the law of August 8, 1786, fixed 
two prices for silver bullion. One price for fine silver 
and one price for standard silver. This law of August 
8,1786, fixed the price of an ounce of fine silver bullion 
at $1,277 per ounce, or 15 dollars, 3 dimes, 3 cents and 
3 mills for a pound of fine silver. 

The mint price which is authorized by the law of 
August 8, 1786, is for standard silver, i. e., silver of 
which one part in twelve is alloy. From a pound of 


SILVER BULLION 


9 


standard silver, therefore, could be manufactured 14 
dollars, 5 cents and 6 mills. If the mint returned 9 dol¬ 
lars, 9 dimes and 2 cents from each pound of standard 
silver brought to the mint to be manufactured into 
disks and certified by the mint label, it must have re¬ 
tained 4 dollars, 1 dime and 3 cents, or in other words 
the mint charged the silver producer or owner of silver 
bullion $4.13 for manufacturing 14 disks and 1 five cent 
piece. 

Gold .—The price of a pound of fine gold was fixed 
by the act of August 8, 1786, at $233.89. The price of 
an ounce $19.49. 

From a pound of standard gold brought to the mint 
could be manufactured 214 dollars and 8 dimes. If the 
mint returned to the gold producer 209 dollars, 7 dimes, 
and 7 cents from each pound of standard gold brought 
to the mint to be manufactured into eagles, the mint 
must have charged $5.72 for manufacturing 21 eagles, 
4 dollars, and 8 dimes. This is the history of the first 
attempt to fix the price of silver and gold bullion. 

We next hear of the subject of the price for silver 
and gold bullion on October 16, 1786, when it was or¬ 
dained by the United States in Congress assembled, 
that a mint be established for the coinage of silver 
and gold. The Assay Master of the mint shall receive 
silver and gold bullion and give his certificate for the 
weight thereof at the following rates: 

The price of gold remained the same, 209 dollars, 
7 dimes and 7 cents. The price of standard silver bul¬ 
lion was raised by this act from 9 dollars, 9 dimes and 
2 cents to 13 dollars, 7 dimes and 7 mills. According 
to this law the price of one ounce of fine silver re¬ 
mained the same. If the silver producer brought one 
pound of standard silver to the mint, the bullion was 
manufactured into 14 dollars, 5 cents and 6 mills; the 


10 


SILVER BULLION 


mint returned to the owner of silver bullion 13 dollars, 
7 cents and 7 mills. This was a charge of 97 cents for 
manufacturing and labeling 14 disks of silver bullion, 
a reduction in the cost of manufacturing the disks from 
$4.13 to 97 cents. Neither gold nor silver were minted 
under the law of 1786. So much for the second attempt 
to fix the price of silver and gold bullion. 

We next hear of the price of silver and gold bullion 
in the law April 2, 1792. 


CHAPTER II 


Price of Silver Bullion, 1792 

/^\N March 3, 1789, thirteen guns were fired from the 
old fort on the Battery, in New York, to indicate 
that the Congress of the Confederacy had come to an 
end; and on March 4, 1789, the first Congress of the 
United States met in New York and our present gov¬ 
ernment became the supreme governing power in the 
Republic. 

April 5, 1790, Congress of the United States in¬ 
structed the Secretary of the Treasury to prepare and 
report a plan for the establishment of a National mint. 
On April 2,1792, the act establishing a mint was passed. 

At a cost of $173,000, the first building erected in 
the United States for public use, under the authority 
of the Federal Government, was the building in Phila¬ 
delphia for the use of the United States Mint. 

The Act of April 2, 1792, provided for the organiza¬ 
tion of the mint and directed in Section 9 the manu¬ 
facture of the silver dollar and the gold eagle. 

Sec. 9. And be it further enacted, that there 
shall be from time to time struck and coined at the 
said mint, coins of gold, silver and copper. Dol¬ 
lars or units—each to be of the value of a Spanish 
milled dollar as the same is now current, and to 
contain 371 1 / 4 grains of pure, or 416 grains of stand¬ 
ard silver. 

What the word value may mean in this section we 
are unable to decide. The weight of the Spanish Real 
or Spanish silver dollar was, from 1728 to 1772, 420 
grains, .916 fine or 384.72 grains of fine silver. In 1772 

li 




12 


SILVER BULLION 


the fineness of the Spanish milled dollar was reduced 
from .916 to .902. 

Consequently the pure silver contents of the Spanish 
milled silver dollar on April 2, 1792, was 378 grains of 
pure silver. So the word value in Sec. 9 cannot mean 
the same weight as the Spanish milled silver dollar. 

% Nor can the word value in Sec. 9 be construed to 
mean, that 371% grains of pure silver branded with 
the lady and the eagle shall be the equivalent of 378 
grains of pure silver contained in the Spanish Real. 

No law can compel a creditor to receive 371 % grains 
of silver in lieu of 378 grains in payment of his coin 
obligations. Consequently the word value in Sec. 9 
means nothing in particular in so far as the coining 
of silver bullion. 

The mistake, or call it what you please, in specify¬ 
ing 371 % grains instead of 378 grains of pure silver 
for the mint weight unit may be due to an error in 
determining the quantity of pure silver in the Spanish 
milled dollar, as the art of assaying was then imper¬ 
fectly understood in the United States. 

Perhaps it was one of the counterfeit Spanish Reals 
coined in London that was assayed. From 1790 to 
1810, London was flooded with debased and counter¬ 
feit Spanish Reals. 

Doctor Rittenhouse, the first Director of the Mint, 
may have recognized the inconsistence of Sec. 9, be¬ 
cause it is claimed that the earlier issues of the United 
States silver dollar corresponded very closely to the 
weight of the Spanish Real or Spanish milled silver 
dollar. 

The successor of Doctor Rittenhouse caused the 
United States standard silver dollar to conform to that 
part of the law authorizing the pure silver contents 
to be 371% grains of pure silver. 


SILVER BULLION 


13 


From the opening of the Philadelphia Mint in 1793 
until 1853 only 2,000,000 silver dollars were coined, and 
this minted silver passed rapidly out of the country. 
The newly minted silver dollars were not circulated in 
the local channels of trade and the American merchant 
soon discovered that a regular profit was being obtained 
from their export. 

The Philadelphia minted silver, being new and 
bright, was readily accepted in the West Indies and 
the Barbadoes in all business transactions and could 
be easily exchanged for the Spanish Real or dollar 
which was 6 grains heavier. 

After exchanging the United States mint weight 
for the Real, the money-changers shipped the heavier 
weight or Real to the Philadelphia Mint for recoinage 
into United States standard dollars. This was a profit 
of 6 grains of silver or nearly 2% on each coin. 

The expensive coining operations of the Phila¬ 
delphia Mint, it soon appeared, were resulting in no 
increase of national coinage, but the silver coinage 
was a source of profit to the dealers in this minted 
merchandise. 

In 1806, President Jefferson, upon learning of this 
state of affairs, at once ordered a suspension of the 
minting of the silver weight unit, and not until 1836 
was the minting and manufacturing of the silver weight 
unit resumed. 




y l)M-m!HUi 


CHAPTER III 

Price of Silver Bullion To-day 

“ T)R1CE” is the key-word that will solve many silver 
bullion problems. The word “price” and the word 
“weight” are synonymous terms in so far as they re¬ 
late to the coinage or division of silver and gold bul¬ 
lion into small portable units or weights. 

A few words on the mint price or mint weight in 
the coinage of bullion. The troy pound, 5760 grains, 
regulates the mint weight or coinage unit. 

Sec. 9 of the Act of 1792, April 2, provides that 
there shall be coined at the mint dollars or units 
each to contain 371.25 grains of pure silver. 

371.25 grains of pure silver equals 1 dollar; 
5760 grains of pure silver equals 15% dollars. 

By this act the troy pound of silver bullion was 
divided into 15% units, that is to say, the price of silver 
bullion was fixed by this act at 15% dollars a pound. 
If the silver producer brought 5940 grains of pure sil¬ 
ver to the mint he could have it manufactured free of 
charge into 16 weight units or dollars, merely an 
arithmetical operation, 16 dollars or weights manu¬ 
factured from 5940 grains of silver. 

Some information on the price of gold: 

Sec. 9 of the Act of 1792, April 2, declares that 
the gold eagle shall contain 247.5 grains of pure 
gold and be a lawful tender for ten dollars. 

247.5 grains of gold equals 10 dollars. 

24.75 grains of gold equals 1 dollar. 

5760 grains of gold equals 232 dollars. 

14 


-1 


SILVER BULLION 


15 


This was the weight division or price of a troy 
pound of gold bullion until the year 1834. 

By the Law of June 28,1834, it was enacted that 
the eagle should contain 232 grains of pure gold. 
232 grains of pure gold equals 10 dollars. 

23.2 grains of pure gold equals 1 dollar. 

5760 grains of pure gold equals 248 dollars. 

Change the weight and you change the price. The 
price or weight division of a troy pound of pure gold 
raised or increased 16 dollars a pound or from 232 to 
248 units, weights or dollars, call them what you please. 

The Newfoundland two dollar gold piece coined 
at the Royal Mint, Tower Hill, London, contains 
47.08 grains of pure gold. 

47.08 grains of pure gold equals 2 dollars. 

23.54 grains of pure gold equals 1 dollar. 

5760 grains of pure gold equals 244 dollars. 

Price or weight division of one troy pound of 
pure gold in United States $248. 

Price or weight division of one troy pound of 
pure gold in England $244. 

The troy pound of gold bullion is divided or manu¬ 
factured into more weight units in the United States 
than in England. The troy pound does not change, but 
the number of units or weights manufactured from a 
pound of bullion may change. A troy pound contains 
5760 grains. 

Divide 5760 grains of pure gold into weights each 
containing 23.2 grains of gold and you have the price 
of a pound of pure gold in the United States. Divide 
a pound of pure silver into units each containing 371.25 
grains of silver and you have the price of a pound of 
silver, namely, 15% units, weights or dollars. It is im¬ 
material what name you apply to the weight unit. 

What difference does it make into how many units 
the pound of silver is divided? 

2—June—23 











16 


SILVER BULLION 


What difference does it make, if the pound of gold 
be divided into 596 units? 

A pound of gold would exchange for no more mer¬ 
chandise if it were divided into 596 dollars instead of 
248 dollars. 

Neither would a pound of silver exchange for any 
more merchandise or commodities if it were divided 
into 30 units, or in other words if the price of silver 
were 30 dollars a troy pound. 

The troy ounce, 480 grains, is the weight unit in 
which all wholesale prices of bullion are estimated and 
computed. Twelve ounces to the pound. Would the 
troy pound, 5760 grains, exchange for any more com¬ 
modities or merchandise if 240 grains or 24 ounces 
equaled one pound troy? Why waste time on this sub¬ 
ject. Kings, queens, and jacks have changed the quality 
of weight units. History tells the result. Prices simply 
change to correspond with the amount of pure metal 
in the unit. 

From 1792 to 1849, silver bullion was the sole 
metallic merchandise in which all debts, all contracts, 
all dues and all obligations were estimated, computed 
and recorded. 

While all contracts and debts were recorded and 
payable in silver bullion, the debtor had the option 
to deliver one pound of gold bullion where the con¬ 
tract or agreement called for the delivery of 15% 
pounds of silver. 

On June 28, 4834, a law was enacted which author¬ 
ized payment of 5760 grains of gold by the delivery 
of 5382 grains of gold. This was a profit of 377 grains 
of gold in a contract calling for the delivery of 5760 
grains. 

Stated another way: Previous to June 28, 1834, 
5760 grains equaled 232 dollars. The Law of June 28, 


SILVER BULLION 


17 


1834, this 232 dollars could be paid by the delivery 
of 232 dollars and still have 16 dollars left over. 

In financial argot this is called changing the ratio. 

Such were financial and minting conditions until 
March 3, 1849, when a law was enacted authorizing the 
coinage of a gold mint weight unit of 23.2 grains of 
pure gold or 25.8 grains standard. 

The law of March 3, 1849, changed the name of all 
gold weights issued from the mint. Changed the name 
of the gold unit from eagle to dollar. 

This law also abolished the “legal tender” quali¬ 
fications for gold bullion. 

Did not the price of gold advance to $3.00? No. 

The price of gold is fixed by Congress, and has not 
changed since June 28, 1834. Congress, and Congress 
alone, has the sole authority to fix the price of gold 
and silver bullion. 

What really happened, financiers circulated many 
rumors that the “Greenback” or promissory note of 
the United States was not convertible into coin. As 
the fear increased in the mind of the owner of the 
United States promissory note that coin could not be 
obtained for the “Greenback,” two and sometimes three 
one dollar United States promissory notes were ex¬ 
changed for one dollar in coin. 


CHAPTER IV 


Troy Pound 

I N entering on a study of the minting of silver bullion 
in the United States the following facts, five in num¬ 
ber, must be fixed in the mind: 

First: Weight and price are univocal, synonymous, 
and interchangeable terms, in so far as they relate or 
refer to the minting of weights of silver and gold bul¬ 
lion called coins. It is necessary that the import of 
this fact should be conveyed to the understanding. If 
the reader will grasp the idea we desire to convey by 
this fact, he has the key that will unlock the solution 
to many a financial question. 

Second: The word “dollar,” like the word ounce, 
is merely the name for a weight unit of bullion—480 
grains 1 ounce, 371 % grains 1 dollar. This word “dol¬ 
lar” as a name for a weight unit of silver bullion was 
first used in London in the year 1675, 117 years before 
Congress applied the name to a weight of silver bullion 
containing 371 ^ grains of pure silver plus the alloy. 
As the word “dollar” forms a very interesting study 
and one too long to interpolate in this chapter, we shall 
leave its considerations for a subsequent and special 
chapter. 

Third: Under no consideration must the word 
“value” be used in discussing the question of silver, 
gold and finance. Substitute a synonym for the term 
“value,” or better still, fashion some phraseology or 
form of expression that will convey the idea you have 
in mind and wish to express by the word “value.” 
Fourth: The trouble, in regard to a solution of the 

18 




SILVER BULLION 


19 


silver bullion question, resides in the mind and not in 
the metal. 

Fifth: A dollar is 371 3 4 grains of fine silver bul¬ 
lion, coined or uncoined, whether domestic or foreign 
bullion, with or without a mint stamp. 

As we stated in our initial fact, weight and price 
mean the same thing when the words refer to minted 
silver and gold bullion. Now what is weight? Weight 
is a definite mass of brass, iron, platinum or other mate¬ 
rial to be used for ascertaining the weight of other 
metals or merchandise. For ascertaining and the 
adjusting of quantities of silver and gold bullion either 
coined or uncoined in the United States, this definite 
mass of metal is declared to be a certain brass weight 
specified in the Revised Statute. 

Revised Statute, Sec. 3548. For the purpose of 
securing due conformity in the weight of the coins 
of the United States to the provision of this title, 
the brass troy pound weight procured by the min¬ 
ister of the United States at London in the year 
1827, for the use of the mint, and now in the 
custody of the mint in Philadelphia, shall be the 
standard troy pound of the mint of the United 
States, conformable to which the coinage thereof 
shall be regulated. 

This statute, we believe, was the first attempt by 
Congress to ensure some precision and uniformity in 
the weights of silver and gold bullion used for com¬ 
mercial transactions. 

This statute establishes the troy pound, 5760 grains, 
as the standard troy pound weight of the United States, 
a weight standard by which quantities of silver and 
gold bullion are priced, regulated and adjusted. 

For quality, assaying is the standard process. 

Now what is the troy pound? Where did this weight 




20 


SILVER BULLION 


originate? If the troy pound of 5760 grains fixes the 
price of silver and gold bullion, some knowledge of its 
origin is necessary if we desire a correct understand¬ 
ing of how prices for silver and gold bullion are fixed. 
As our standard troy pound weight was obtained from 
London, to London we must go for an answer to these 
questions, hut we have not the space in this article to 
enter into a detailed account of the history and origin 
of the troy pound. 

Suffice to say that the Tower pound of 5400 grains 
was the original Sterling Standard, and the first mint 
weight of London. This weight was abolished as the 
mint standard of London in the year 1527 by an ordi¬ 
nance of Henry VIII, enacting “That the Pound Tower 
shall no more be used and occupied, but all manner 
of golde and sylver shall be weighed by the Pounde 
Troye, which maketh XII ounces Troye.” 

Thus we have the Pound Troy of 5760 grains estab¬ 
lished as the legal mint weight at London in place of 
the Tower pound of 5400 grains. 

In the time of Queen Elizabeth—1558 to 1603—a 
standard of the avoirdupois pound was placed in the 
Exchequer. Standards of the troy pound were placed 
in the Exchequer, Goldsmith’s Hall, and the mint. 

Nothing particular seemed to have occurred with 
regard to the weight standard until the year 1758. A 
committee of the House of Commons was appointed 
to investigate the subject of weights and measures. 

On comparing the troy pound kept at the mint with 
the troy pound kept at the Exchequer, it was discovered 
that the mint pound was 1% grains heavier than the 
Exchequer pound. As the Exchequer pound had been 
in frequent use for 170 years, the committee concluded 
that it had become somewhat worn and accordingly 
they adopted the mint pound. 


SILVER BULLION 


21 


> 


It was then considered whether the London mint 
standard should in the future be the troy pound or the 
avoirdupois pound, and the committee resolved on the 
troy pound for these reasons: “That it is the weight 
best known to the English law; that which hath been 
longest in use; that by which our coins are weighed; 
that which is best known to the rest of the world; that 
to which our learned countrymen have referred and 
compared ancient and modern weights; the weight 
which hath been subdivided into the smallest parts.” 

One copy or duplicate of this standard troy weight 
was delivered to the clerk of the House of Commons 
and another to the King’s assay master of the mint. 

In 1824 the parliamentary troy pound of 1758 was 
recognized and designated as the “Imperial troy pound 
of Great Britain.” 

In 1827, at the request of Dr. Samuel Moore, who 
was director of the United States Mint, a duplicate of 
this standard troy weight was obtained by the Hon. 
Albert Gallitin, at that time the United States Minister 
in London. This duplicate was brought to the United 
States and deposited with the mint at Philadelphia. 
Thus we have a weight standard conformable to which 
all mintage of silver and gold bullion is regulated. 

Every system of weight must be based on some 
tangible fundamental quantity. A concrete representa¬ 
tive of the quantity selected is called a unit or standard. 
A standard or unit must be preserved in its integrity 
for the purpose of comparison, as all computation by 
weight is merely the comparison of one weight with 
another weight or one quantity with another quantity. 

The official and legal unit must also be preserved 
in order to provide against false weights; and a false 
weight must not be confused with a debased weight. 

Previous to the enactment of Revised Statute, Sec. 


22 


SILVER BULLION 


3548, no legal or official standard or quantity was in 
use by which the minting of silver and gold bullion 
was regulated; the sole unit for regulating the coinage 
of the mint was the “piece of eight,” a weight of silver 
bullion minted in Mexico. 



CHAPTER V 


- 


Silver Bullion—The Money of Account 

/ | A HE reader, no doubt, is familiar with the fact that 
all commercial and business transactions in the 
Colonies were conducted and accounts rendered in 
pounds, shillings and pence. There was no coined 
weight in circulation at that time representing a pound. 

The shilling was a weight unit of 80.7 grains of fine 
silver bullion used in London for retail and small cash 
transactions. Shillings were in circulation in small 
quantities in the Colonies; in fact, minted weights of 
silver bullion for retail or commercial transactions 
were a scarce merchandise at that time in the Colonies 
as well as in London. 

In London the business community was put to great 
strait for silver change and various expedients were 
resorted to. 

Private firms, The Goldsmith’s Hall Company, and 
the Rank of England issued weights of different 
design. The most successful method was to restrike 
“pieces of eight.” This was done, not at the Royal 
Mint, but at a private mint in Birmingham operated 
by Boulton & Watt. One million four hundred and fifty 
thousand of these weights were issued in that year. 

For retail transactions this shortage of silver bul¬ 
lion impelled the general use of private tokens of lead, 
tin, latten and leather among the chandlers, grocers, 
vinters and other trades. These tokens were only to 
be redeemed for cash, or commodities given for them, 
at the same shop from which they had been issued, 
and nowhere else. 


23 




24 


SILVER BULLION 


In the Colonies, tobacco, skins, shells, sugar and salt 
were the chief merchandise used at the cash counter 
in Colonial days. No coinage of any importance had 
ever existed in the Colonies, pieces of eight had been 
extensively used and payment of the coin of account 
was very much deranged. By “coin of account” is 
meant a denominational weight unit of bullion, and 
its fractional or decimal parts used to express prices 
in which commercial transactions are carried on, con¬ 
tracts made, and accounts for future delivery of the 
bullion are recorded. In the early days of the Re¬ 
public, merchants estimated prices in shillings which 
were weight units of 80.7 grains of pure silver bullion. 
In payment of accounts they used the piece of eight 
which was a weight unit of silver bullion containing 
378 grains of pure silver. 

The piece of eight was a common weight unit into 
which the shilling weight of account could easily be 
translated. This somewhat facilitated business trans¬ 
actions. This system was inconvenient and a general 
desire was expressed among the people, merchant and 
mechanic, trader and trapper for some uniform sys¬ 
tem for the weight of account. 

By an Act of Congress, passed 2nd April, 1792, it was 
enacted: 

Revised Statute, Sec. 3563. The money of ac¬ 
count in the United States shall be expressed in 
dollars or units, dimes or tenths, cents or hun¬ 
dredths, and mills or thousandths, and all accounts 
in public office and all proceedings in the courts 
shall be kept and had in conformity to this regula¬ 
tion. 

This, we believe, is the first time a specific quantity 
of any merchandise was ever authorized and adopted 


SILVER BULLION 


25 


by legislative action to be recognized and received in 
payment of commercial transactions, the weight of 
account for commercial transactions in all other coun¬ 
tries having been developed by natural evolution, or 
in other words, grew in the minds of the people through 
custom. 

This statute authorized the mercantile community 
to conduct their business and keep all accounts in the 
mint unit of 371 ^4 grains of silver bullion. 

All prices, all deferred payments, all taxes and 
tariffs, all dues, public and private, obligations, official 
and judicial, compensation for service, all wages and 
salaries, must be accounted for, and be paid by the 
delivery of silver or gold bullion. The debtor had the 
option of delivering or paying either silver or gold. 

This statute created a market and a monopoly for 
silver and gold bullion for all business transactions. 
We are also indebted to this statute for the elimination 
of the London commercial weight units of pounds, 
shillings and pence, in our mercantile transactions. 

Like every law enacted by Congress, time was re¬ 
quired to familiarize the public with the new name and 
the new weight for estimating and recording prices. 
We must not forget that price and cash are dependent 
upon and necessarily adjust themselves to weights of 
silver and gold bullion, and that all our ideas of cost 
and price are fixed with reference to our present mint 
weight unit of bullion, i. e., the dollar. 

The mere fact that this dollar weight or its multiple, 
which for common convenience, uniformity in quality 
and quantity is manufactured by your hired man (alias 
the Government), and this official enjoys the function 
of certifying the contents of the unit by stamping an 
eagle on the disk of bullion, it by no means follows 
that the Government is, or ought to be, considered as 




26 


SILVER BULLION 


the sole manufacturer, owner and custodian of current 
weights of silver and gold bullion. 

Coin, the same as other certified and inspected mer¬ 
chandise, is the absolute property of those to whom 
the bullion has been sold, exchanged or bartered. Any¬ 
one who gives merchandise, property or corporal labor 
for bullion, when he receives the metal the disks of 
bullion are his property as much as the merchandise, 
labor, talent or energy which were in his control. 

The chief duty of our hired man (alias the Govern¬ 
ment) is to manufacture the disk, certify its contents 
and prevent the circulation of false, debased or muti¬ 
lated weights of bullion. Coins are mere pieces of 
bullion of fixed weight and quality, tested and certified 
by authority of Congress, receivable and recognized by 
all citizens. Coins may be square, round or oblong. 

A contract to pay one thousand dollars is simply a 
contract to deliver a certain number of pieces or a 
certain amount of bullion of a definite weight and fine¬ 
ness; and the coins are such pieces of bullion certified 
by authority of Congress. It is not obligatory to de¬ 
liver the contract weight in single coins, the amount 
may be delivered in bulk or in bars, nor is it necessary 
to bring the merchandise to the official factory, i. e., the 
mint, in order to have the quality and quantity of the 
metal certified by the picture of an eagle. Any reliable 
assay office can perform this function as well as the 
mint. 

Ownership of silver bullion is not conveyed to an 
assayer simply because he marks the weight and fine¬ 
ness upon the metal. Ownership of silver bullion is 
not transferred nor does the metal become the property 
of the “State” or the “Government” by the impression 
of a die at a public factory known as a mint. 

Fix this fact in your mind. Coin after mintage is 


I 


SILVER BULLION 27 

still bullion. Coin is bought and sold the same as other 
merchandise. A purchase or a sale of silver bullion in 
the form of coin is a complete transaction. The seller 
of the goods or property wishes to procure possession 
of silver and gold bullion, not merely for the sake of 
possessing the metal, but for what he can procure by 
the resale of the bullion. The motive for the business 
transaction as to the use of the bullion has nothing to 
do with the transaction between seller and purchaser. 

The purpose of the merchant may not be to ex¬ 
change the bullion received for merchandise different 
from what he sold. The merchant may intend to pur¬ 
chase with the coin the same kind of merchandise, 
goods, or property which he sold. 

The purchaser of the goods, merchandise or prop¬ 
erty may intend to sell those identical merchandise 
again for bullion and with the coin so acquired pur¬ 
chase more goods of the same kind. The truth is that 
the ultimate purpose of merchants in the use of bullion 
received in a mercantile speculation does not enter at 
all in the transaction. 






CHAPTER VI 


Barter 


HE fact that a pound of gold is divided into sixteen 



times more weight units than are manufactured 
from a pound of silver does not indicate that a pound 
of gold is exchangeable for sixteen pounds of silver or 
vice versa. Nor does it indicate the amount of mer¬ 
chandise that may be obtained by bartering either 
weight of bullion. 

Barter, as every novice in finance knows, is the ex¬ 
change of one commodity for another, or to trade by 
exchanging property or merchandise for disks of bul¬ 
lion called coins. The selling and buying of commodi¬ 
ties, property or merchandise is called business or 
barter. 

The necessity for selecting some merchandise or 
commodity to facilitate business was met by the adop¬ 
tion of silver and gold bullion. Many commodities were 
unsuccessively employed as a universal bartering mer¬ 
chandise before custom, sanctioned by usage, adopted 
silver and gold bullion. 

Silver and gold became the merchandise all were 
eager to acquire—merchant, mechanic and manufac¬ 
turer. Silver and gold are the ideal merchandise to 
have, to hold and to control, the ideal merchandise 
to store or spend, to save or squander. 

Silver and gold are well adapted for business trans¬ 
actions. They do not evaporate, rust or rot. They are 
divisible into various sizes and weight, so as to be 
equally useful in the smallest business transaction as 
well as the largest operations of commerce. 


28 



SILVER BULLION 


29 


The public very readily grasped the fact, that anyone 
who had anything to sell was very eager to obtain 
possession of those disks of bullion called coins. Every¬ 
one knew that coin could be sold and bartered in large 
or small quantities, morning, noon or night. 

Everyone tries to manage his affairs in such a man¬ 
ner as to have at all times a quantity of silver and gold 
coin, knowing well that if he possesses this merchan¬ 
dise he is sure of obtaining any other merchandise he 
may desire. 

The seller of every other merchandise must seek the 
particular customer who deals in it, or wants it for a 
particular purpose; but the seller of mint-branded mer¬ 
chandise finds a customer in the first man he meets 
who has other merchandise or labor to dispose of. 

Under our present business system, the person who 
desires to obtain commodities, merchandise or prop¬ 
erty he does not possess, can obtain them by means of 
two operations. Our present system requires first, the 
barter of his labor, merchandise or property for coin; 
second, the barter of the coin for what he desires to 
possess. This we call business, and to-day silver and 
gold coin are tbe exclusive merchandise that all must 
first possess in order to satisfy their wants or gratify 
their desires. 

Hence the owner of coin possesses a more favorable 
position in the business world than the possessor of 
other merchandise. 

The owner of coin —Trademarked Merchandise —is 
always able to find some one to accept it, and if he is 
at a loss to make use of it at once, he still has the simple 
expedient of storing the bullion for a more favorable 
market. With other merchandise this expedient is not 
always possible. 

To-day the craving for coin is universal, unlimited 


30 


SILVER BULLION 


and unsatisfied. To-day the mechanic barters his labor 
for these official weights of merchandise called coins. 
After the mechanic has purchased by his labor these 
coins, he again barters them for food, sells them for 
clothes or exchanges them for shelter. 

There were no standards, no mediums, and nothing 
was measured in all these transactions. 

If the mechanic was of an economical disposition 
he deposited part of the merchandise for future use 
in a warehouse organized for that purpose called a 
bank. 

To-day the merchant, subtile, suave and strenuous, 
studies long and deep how he can acquire possession 
of this merchandise with the mint— Trademark — 
known as coin. The merchant knows that he can sell 
coin at any time, at any place and in any quantity. 
He, too, barters his goods and his products for silver 
and gold bullion and deposits the metal in his bank. 

There were no standards, no mediums, and nothing 
was measured in these transactions. 

Our rural friend, the farmer, he too barters his corn 
and his cattle, his wheat, his pork and his produce for 
disks of silver and gold. He, too, is very anxious to 
exchange his perishable property for merchandise that 
is portable, merchandise that can be partitioned, mer¬ 
chandise that will pay the mortgage and the men; mer¬ 
chandise that will serve his well being, merchandise 
that he can deposit in the bank, merchandise that he 
can sell in any market for tools, improvements and 
implements. 

All these transactions, all this transfer of property 
from one owner to another without a measure, a 
medium or a standard. No wonder our rural friend 
desires to accumulate a stock of this merchandise. 

We read in Herodotus, Yol. 4, p. 196, that the 



SILVER BULLION 


31 


Carthaginians in the fifth century B. G. traded by sea 
for gold to the west coast of Africa. 

“There is a country in Libya and a nation beyond 
the Pillars of Hercules which they are wont to visit 
and transact business or barter. They no sooner arrive 
than forthwith they unlade their wares and their mer¬ 
chandise, and having disposed them after an orderly 
fashion along the beach leave them and return aboard 
their ships. To advertise the fact that they desire to 
do business with the natives, they raise a great smoke. 
The natives when they see the smoke come down to 
the shore and lay out to view as much gold as they 
think the worth of the wares and merchandise. The 
natives then withdraw to a distance. The Cartha¬ 
ginians upon this come ashore and look; if they think 
the gold enough, they take it and sail away, but if it 
does not seem sufficient they go aboard once more and 
wait patiently. The natives again return and add more 
gold until satisfactory terms are reached and the Car¬ 
thaginians are content. 

“Neither party deals unfairly with the other. The 
Carthaginians never touch the gold until the amount 
is sufficient to satisfy their desire and yield a profit, 
nor do the natives ever carry off the goods till the 
gold is taken away.” 

In this transaction we have neither words nor writ¬ 
ing, neither standards nor systems, neither measures 
nor mediums. Simply an exchange of merchandise for 
bullion, and bullion for merchandise. The same sys¬ 
tem to-day—1923—merchandise for bullion, bullion for 
merchandise. 

It must be evident that the introduction of silver 
and gold bullion in portable packages called coins re¬ 
sulted in a great increase of commercial transactions. 
All packages are branded; the purchaser knows that 


3 





32 


SILVER BULLION 


he received the quantity and quality of metal that was 
called for in the bargain. 

Silver in one size package, gold in another size 
package, both branded and certified as to quantity and 
quality, both packages known as dollars. 

Now this particular system of first exchanging the 
propert}^ we possess for certified merchandise called 
dollars and again bartering the dollars for goods we 
desire makes no difference in the essential character 
of the transaction. 

This was our business system yesterday, this is our 
business system to-day, and this will be our business 
system to-morrow. 

All who buy and sell, borrow and lend, must un¬ 
derstand this system. This system creates debts and 
obligations expressed in terms of this mint-branded 
merchandise called dollars. 

Contracts are made for the future delivery of 
this government-branded merchandise called dollars. 
Agreements are formulated for the payment at specific 
periods of this commodity with the government brand 
and name. 

Bonds, notes, certificates, dividends and debts all 
must be cancelled by the delivery of this branded mer¬ 
chandise, silver and gold bullion. 

The quantity of other merchandise that may be 
obtained in exchange for this minted merchandise at 
the maturity of the contract may be greater or less than 
when the contract was made. This is only the ordi¬ 
nary business risk which every business man must take 
and for which he must make allowances in his business 
calculations or speculations. 

When the contract does not specify the kind of dol¬ 
lar to he paid, that is, when the contract is silent as 
to which minted package of merchandise is to be de- 


SILVER BULLION 


33 


livered, the contract can be fulfilled by the delivery 
of silver, gold or greenbacks. 

If the contract is for the delivery of the gold pack- 
age, the privilege or option to deliver silver is waived. 
A contract to pay the gold minted merchandise can be 
fulfilled only by the delivery of gold or greenbacks. 
The greenback is merely a promissory note redeemable 
in silver or gold, at the option of the Treasury. 

The United States statutes define a dollar as 
371.25 grains of pure silver or 23.22 grains of pure 
gold. There is no other way in which a debt can be 
discharged except by the delivery of the weight of 
bullion stipulated in the contract. That is, if the 
creditor insists upon the delivery of the metal. 

When the disks of silver and gold became the ex¬ 
clusive merchandise the public bought and sold in 
order to possess other property or goods, and the re¬ 
tail business of bartering the coins had increased to 
such an extent that large cpiantities of the bullion were 
required, the question arose, how and where shall these 
small packages be manufactured? 

It is a matter of considerable importance to devise 
the best form for these packages. This certified mer¬ 
chandise must be manufactured into packages that will 
prevent counterfeiting, the fraudulent removal of con¬ 
tents, and be protected from loss caused by legitimate 
wear and tear. 

To-day these certified packages are exclusively 
manufactured at the mint. The reason for this is not, 
as has been supposed by many business men, that some 
additional attribute, or some mysterious power pos¬ 
sessed by the government machine, is conveyed to the 
merchandise, the only reason for having the bullion 
manufactured at the mint is the importance of absolute 


34 


SILVER BULLION 


security that the authorized quantity and quality of 
metal is placed in the package. 

Study these facts well, they are manifestly of the 
most importance, as a thorough knowledge of our coin¬ 
age system depends upon the understanding of a few 
elementary and simple facts. 

Money and coin are not synonymous terms. A 
standard silver dollar is coin. A silver dollar is also 
money. A Greenback and a Federal Reserve Note are 
money but they are not coin. 

Silver and gold bullion are entitled to the name 
money whether they are manufactured and branded 
at the mint or not. A little judgment and considera¬ 
tion will convince the reader that coin, or small official 
weights of bullion manufactured for retail transactions, 
possess no attribute or property that is not possessed 
by the bullion in the form of bars or ingots. In inter¬ 
national trade bars of bullion are preferred to bags of 
coin. 

All coinage for export is a waste of time and money. 

It must be patent to anyone who has followed this 
argument that the government machine at the mint 
does not add anything to or subtract anything from 
silver and gold bullion. 

The miner owns the bullion when brought to the 
mint. The mint forms the bullion into disks or bars 
of uniform size, weight and purity and returns the cer¬ 
tified metal to the miner, the miner to barter the bul¬ 
lion as best he can. 

The public has no proprietary right in these official 
weights except to acquire them as easily or as cheaply 
as circumstances will permit. Neither does the gov¬ 
ernment possess any power of ownership in the cer¬ 
tified bullion issued from the mint, except to protect 


SILVER BULLION 


35 


the public from light, debased or counterfeit weights 
of bullion. 

Allow me again to direct your attention to the rea¬ 
sons why these weights are issued from the public fac¬ 
tory and not from a private plant. 

Uniformity of shape, size, weight and purity, dan¬ 
ger from counterfeiting decreased and diminished. 
These are the principal reasons why the official weights 
of silver and gold bullion used for retail transactions 
are issued from the mint or public assay office. 

Under our present coinage laws, the owners of gold 
bullion possess the unrestricted privilege to have their 
bullion manufactured into various size weights at the 
public factory established for that purpose. 

The owner of gold bullion can have his metal manu¬ 
factured into any of the following weights: 

58 grains of gold called the quarter eagle. 

116 grains of gold called the half eagle. 

232 grains of gold called the one eagle. 

464 grains of gold called the double eagle. 

Under our present coinage laws, the owner of silver 
bullion possesses the unrestricted privilege to have his 
bullion coined into weight units containing 412.5 grains 
of standard silver. 

This weight is known as the standard silver dollar. 

This statement will receive due consideration later 
on.* The owners of silver bullion also possess the un¬ 
restricted privilege to have their bullion manufactured 
into five ounce bars.f 


* Chapter XIX. 
t Chapter XVIII. 






CHAPTER VII 


The Word Dollar 


HERE is no word in economic or financial his- 



tory—the word “value” excepted—that has caused 
so much fatuous financial notoriety to be wrecked as 
the word “dollar.” Dollar and value, twin monetary 
rocks that have wrecked the galleon of many a soi- 
discint financial mariner as he sailed o’er the seas of 
Coinage and Finance with his cargo of monetary prin¬ 
ciples, plans and policies. Monetary policies, plans 
and principles that were as numerous as they were 
worthless. 

The English language in its earliest form emerges 
into history as the speech of certain German tribes who 
first invaded and settled in Britain in the middle of the 
fifth century. By gradual stages of change, modern 
English has descended from the patois of these wild 
Teutonic tribes. 

The history of words, their origin and journey down 
the stream of time and their flow into the current 
speech of the people is an interesting study. The word 
dollar, in so far as it applies to a name for a minted 
weight of silver bullion, is undoubtedly German, being 
slightly altered from thaler. 

Volumes of economic history have been written 
anent the standard silver dollar; financial libraries by 
the tens of thousands are circulating a legal tender for 
all monetary knowledge and coinage information ex¬ 
cept when the truth in regard to the silver dollar is 
stipulated in the contract. In current mintage informa¬ 
tion, which is of the vintage of 1873, the truth in regard 


36 






SILVER BULLION 


37 


to the silver dollar is conspicuous by its absence, partly 
from lack of apprehending a few basic and elementary 
principles of mintage, but principally from the mental 
attitude of economic writers upon the questions of 
silver coinage as well as a failure to comprehend the 
original significance of the term dollar, plus the accep¬ 
tance with unquestioning submission of the imported 
explanation of the meaning of the term dollar. 

But ideas and opinions are constantly being mod¬ 
ified by increased knowledge; so to-day the acumen of 
the silver producer is to abandon all imported and 
accepted propaganda and to adopt modern opinions 
and ideas on mintage. We shall begin our history of 
the “dollar” with facts on the thaler. 

Current authorities on mintage claim that Duke 
Seigismund in 1484, Maximillian I in 1494, and Fredrick 
of Saxony in 1500 manufactured or cast silver bullion 
into disks with an extraordinary elaborated design. In 
1517, or 1519, in the little town of Joachimsthal, a little 
north of the present aristocratic watering place, Carls¬ 
bad, weights of pure silver bullion were minted, eight 
pieces to the Cologne mark, i. e., about one ounce avoir¬ 
dupois apiece. These disks of silver bullion minted 
at Joachimsthal or Joachims Valley were known as 
Joachimsthalers and were identical in weight with the 
silver coin that had been minted in the Tyrol in 1472 
and 1484. Owing to the abundance and reliability of 
the Joachimsthaler their name became current and sup¬ 
planted permanently whatever name that may have 
prevailed for the silver weights fabricated in 1484 and 
1500. 

But we are a little ahead of our story. Early in 
the fifteenth century, Jasper Schlick discovered rich 
veins of silver on his estate known as Joachimsthal or 
the Valley of St. Joachim. Jasper was made a count 


38 


SILVER BULLION 


and in 1432 was given the privilege to coin silver bul¬ 
lion. He seems to have died without exercising this 
privilege to any great extent. He left no children and 
the four grandsons of his brother developed the hid¬ 
den wealth they inherited. 

In 1517, as the silver mines began to grow in richness 
and production, the brothers began to coin pieces of 
silver bullion, which they styled Joachimsthaler Gul- 
dengroschen. In course of time the people found the 
name too long and at first the name Guldengroschen 
was left out, then the name of St. Joachim; finally the 
disks of silver bullion were simply called “Thalers.” 

In 1526 Bohemia passed into the control of Austria 
under Emperor Ferdinand I and as early as the year 
1531 the name thaler is found unqualified in his regula¬ 
tions on coinage. 

With slight change in spelling the word thaler was 
adopted by the Teutonic countries of Europe, and soon 
spread into Norway, the Netherlands and Britain. 

Thaler, Daelder, Daler, the British settled on Dollar. 
We find the word “dollar” in use in London in the 
year 1635. In 1635 the bishop of Moray was specially 
appointed by Charles I to search for and arrest all 
forgers of false and counterfeit dollars. 

A later proclamation in the same year, 1635, directed 
that “The coal maisters and salt maisters receive no 
payment for the price of their salt and coals in dollars 
after Martinmas next.” 

The word dollar can be found in all old English dic¬ 
tionaries printed in the latter part of the seventeenth 
century, one hundred years before Congress authorized 
the term to be used as a name for a weight unit of silver 
bullion. 

Even early in the seventeenth century the word 
dollar seems to have been well known to scholars. 



SILVER BULLION 


39 


William Shakespeare, the greatest of dramatic poets, 
we find uses the word dollar in “Macbeth,” Act 1, Scene 
2, Line 64. Ross, one of Scotland’s noblemen, is speak¬ 
ing on his arrival from Fife at the camp near Forres, to 
Duncan the King. In reply to Duncan, the Thane of 
Ross states how Sweno, King of Norway, sues for peace 
on being defeated in battle by Duncan’s men and that 
these refused 

“The burial of his men, 

Till he disburse at Saint Come’s Inch 
Ten thousand dollars to our general use.” 

We also find the word dollar in Shakespeare’s “Tem¬ 
pest” in the second act, scene 1, where Alonso, King 
of Naples, and Sebastian, his brother, together with 
Gonzalos the honest old counsellor, Lord Adrian and 
Francisco and others are conversing on an island where 
they have been cast by a furious gale. Shakespeare 
puts into the mouth of Sebastian the following answer 
to Gonzalos moralizing on grief: 

Gonzalos:—“When every grief is entertain’d 

that’s offer’d 

Comes to the entertainer-” 

Sebastian:—“A Dollar.” 

The word dollar is also found in “Measure for Meas¬ 
ure,” written by Shakespeare: 

“Three thousand dollars a year ay and more.” 

“Measure for Measure”—1. 2. 

Turning to the latest in dictionaries we find in 
Murray’s New English Dictionary: 

Dollar:—Forms: Daleir, Dalder, Doler, Dolor, 
Daller, Dollor, Dollar. 



40 


SILVER BULLION 


The English name for the German thaler, 
a large silver coin of varying weight, cur¬ 
rent in the German States from the six¬ 
teenth century. 

1560 In Burgon’s Life and Time of Sir Thomas 
Gresham. 

Vol. 1, page 334. To be received of the 
countie of Mansfield .... 300,000 dal- 
lors. 

1601 R. Johnson, Kingdom & Commonwealth. 
2 dollars of money .... every house a 
dollar. 

Authorities, many and numerous, can be quoted in 
support of the use of the word “dollar” in the sixteenth 
and seventeenth centuries. 

To-day, nearly 300 years after the introduction of 
the specific names thaler and dollar for minted silver 
weights, names that have played an important part in 
economic and financial history, the two most popular 
names for minted silver bullion circulating in the com¬ 
mercial world are One Dollar and Thaler. 

The most popular of the silver thalers circulating 
in the commercial world is 433 grains of silver bullion 
known as the Maria Theresa Thaler. It has a wider 
circulation and a more interesting history than any 
other thaler. This piece of silver bullion has been 
minted in Austria for 125 years without change of 
design and all coins bear the same date, 1780. By a 
law passed in August, 1892, it was ordained that they 
should continue to hear as at first coined the portrait 
of the “Empress of glorious memory” and their original 
date. 

These thalers, sometimes called Levant Dollars be¬ 
cause they circulate in the Levant, have continued to 


SILVER BULLION 


41 


be minted from 1780 to 1900 without any variation in 
the die. 

The principal markets in which silver bullion with 
this popular brand is sold are at Trieste, Zanzibar, 
Massowah, Alexander and Tripoli. They were circu¬ 
lated in great amounts during the Abyssinia War, in 
1867, and in the Ashanti country in 1873. The Maria 
Theresa Thaler is the only current silver European coin 
in Abyssinia. During the war in Abyssinia the British 
troops were unable to circulate silver minted in Lon¬ 
don, and the war office was obliged to have recourse 
to the mints of Austria for the coinage of thalers in 
order to pay the troops. 

Maria Theresa Thalers are the only silver coins used 
in all trading and commercial cash transactions along 
the west coast of Africa, in Morocco, Egypt and Borneo. 
That the silver producer may know where some of his 
bullion is sold, a report of the Austrian mint shows that 
the following number of thalers were minted: 1904, 
449,000; 1905, 285,000; 1906, 924,000; 1907, 10,397,000; 
1908, 3,228,000—15,280,000 thalers, 11,480,000 ounces of 
silver bullion minted in five years. 

Eleven million ounces of silver bullion purchased 
by European financiers at 50c on the dollar; eleven mil¬ 
lion ounces, one train load, of silver bullion must be 
sold to Europe at a loss of 60c on each and every ounce 
of bullion in order to increase foreign trade and pres¬ 
tige; 348 tons of silver bullion, the universal merchan¬ 
dise, exacted from American trade, American com¬ 
merce and the American silver producer with the aid 
and consent of Congress obsessed by the idea that silver 
bullion must be inspected, stamped and certified by the 
picture of an eagle, at a public factory and assay office 
called a mint. 

Portraits, pictures and labels upon various weights 









42 


SILVER BULLION 


of silver bullion have played a very important part 
in the circulation of the white metal in many lands. 
In the Orient, sentiment as well as utility has not dimin¬ 
ished in the passing years the esteem with which the 
white metal is held. 

A recent report* to our government by Mr. Addison 
E. Southard, our counsel at Aden, Arabia, presents 
some facts that will interest all producers of silver 
bullion. 


* Commerce Reports, January-March, 1918, Nos. 1-75, Page 904. 



CHAPTER VIII 


Silver Dollar—Scotland 

T HE name dollar for indicating and identifying a 
weight of silver bullion had become so popular by 
the close of the seventeenth century that it became 
accepted in London as a generic name for silver coins. 
The Rev. Rogers Ruding is considered one of the lead¬ 
ing authorities on London mintage. In his “Annals of 
the Coinage,” Vol. 2, p. 349, we read: “In this year 
1675 coins were struck for Scotland. They were called 
‘Dollars.’ These dollars contained 412% grains of sil¬ 
ver bullion, and were intended to be of the same weight 
as those coined in 1665, viz., 413 grains troy.” 

We also find in a perusal of the “Coinage of Scot¬ 
land,” by John Lindsay, Escp, Rarrister at Law, another 
account of this Scotch silver dollar: 

“Under this King (Charles II) the coinage of Scot¬ 
land, like that of England, underwent considerable 
change, the press being substituted for the hammer. 
His coins (Charles II), which are very numerous, are 
of two classes, the first consisting of the four merk 
piece and its divisions and the second of the dollar 
and its parts. 

“The coinage of dollars commenced with the year 
1675. The dates most met with on these coins are the 
following: 1675, ’79, ’80, ’81 and 1682. The weight of 
this dollar is 408 grains and it passed in Scotland for 
56 shilling.” 

There seems to be a difference of five grains of 
silver between the contents of the dollar mentioned by 
Ruding and the dollar mentioned by Lindsay. 

43 


44 


SILVER BULLION 


A facsimile of the Scotch silver dollar can be seen 
in Ruding’s “Annals of the Coinage,” Vol. IV, plate 42, 
number 5. 

Another account and facsimile of the Scotch silver 
dollar may also be seen in “Numismate Scotiae,” by 
Adam de Cardonnel, page 119, and a cut of the coin 
on page 121, No. 1. 

Also in “Coins of Great Britain in the British 
Museum,” by Herbert A. Gruaber, F. S. A., plate 53, 
No. 202, date 1682. 

He states that, “The coining dies for this silver 
dollar were made by Jan Roettier, the weight 409.1 
grains troy, and the dollar was intended to circulate 
in Scotland as the equivalent of 53s. 4d. They were 
issued by Act of February 25, 1675, the same act that 
authorized the minting of the 4 merk piece.” 

By an Act of Parliament, February 25, 1675, the 
Edinburgh Mint issued a series of silver coins, of which 
the largest was the Four Merk Piece. In the “Records 
of the Coinage of Scotland,” collected by R. W. Coch- 
ran-Patrick, the Act of February 25, 1675, is printed in 
full and nowhere in this act is the word “dollar” men¬ 
tioned, yet in his facsimile of the coin shown in plate 
XIV, No. 6, they are denominated “dollars.” 

Previous to the issue of this silver dollar for cir¬ 
culation in Scotland, no silver coin had received the 
official title of a “dollar.” True, other silver disks cir¬ 
culating in the channels of trade were called dollars , 
but their official or authorized name at their local mint¬ 
age was either the Real or a Thaler. 

The word dollar was not devised by Congress. Con¬ 
gress found the term dollar a settled and known 
appellative for a weight of silver bullion circulating 
in the financial and commercial world. The term ounce 
is a name for 480 grains troy weight, the term ounce 


SILVER BULLION 


45 


is also the name for 437% grains avoirdupois weight; 
so with silver, 371% grains of pure silver bullion plus 
an alloy is named a dollar. Twenty-five and eight- 
tenths grains of standard gold, a different quantity and 
a different merchandise, is sold in the commercial and 
financial world by the same name, i. e., a dollar. 

While the term ounce is used in the avoirdupois 
weight system to express or verify quantities of mis¬ 
cellaneous merchandise, the troy ounce and the mint 
weight “ dollar ” are restricted to the verification of 
weights of silver and gold bullion. Neither the avoir¬ 
dupois weight unit, nor the troy silver weight unit, 
nor the Congressional mint weight unit of silver re¬ 
quire a mint brand. 

In Sierra Leone, in 1791, we next hear of the silver 
dollar of 100 cents. The Sierra Leone dollar was coined 
three years before the United States Mint issued silver 
weights of bullion, branded with the lady and the eagle 
and also known by the name dollar. While the exclu¬ 
sive right to use a trade name and a mark or symbol to 
denote its ownership is property, we desire to ask the 
question, “The property of whom?” 

Not Congress. Congress found the name. Yes, we 
might say pirated the name. Not the mint. Where 
does the ownership reside for the name and the trade¬ 
mark on the silver dollar? 

In view of the history and the facts appearing in the 
case, the question is a grave one, whether the silver 
producer has not the exclusive right to the symbol or 
trademark on the silver dollar, as well as an unre¬ 
stricted use of the term dollar to designate and identify 
his bullion. 


CHAPTER IX 


Silver Dollar—Sierra Leone 

S IERRA LEONE is a colony and protectorate of Great 
Britain on the west coast of Africa. It has an esti¬ 
mated area of about 4,000 square miles. In 1787 the 
“Sierra Leone Company” established a colony or settle¬ 
ment for slaves. The first attempt proved a failure and 
a second settlement was established in 1791 for freed 
negro slaves. This purpose is symbolized by the device 
on the reverse of the coin, struck in 1791, by Matthew 
Roulton, for the Sierra Leone Company, viz., a white 
hand clasping a black one. 

The Sierra Leone Company struck silver dollars of 
100 cents and small weights of 50, 20 and 10 cents. 
The “Company” Silver Dollar weighed 408 grains and 
contained 340.24 grains of pure silver, 31 grains less 
than the United States silver dollar first minted three 
years later, or 1794. According to the Sierra Leone 
silver dollar, the price of silver bullion is $1.44 per 
ounce, or $17.28 per pound troy. That is to say, the 
company divided the pound of silver bullion into 17 
one-dollar pieces, and 28 cents in small weights. This 
was two more dollar pieces, or two more weight units 
minted from the pound of silver bullion by a private 
corporation than were fabricated from a pound of 
bullion minted at the United States Mint. 


46 


CHAPTER X 


Silver Dollar—London Bankers, 1804 

TN the last decade of the eighteenth century and the 
early years of the nineteenth, the financial chieftains 
of London, after long and laborious study of Adam 
Smith’s “Wealth of Nations,” discovered that there was 
a great shortage of wealth, the silver coinage circulat¬ 
ing in London had disappeared. At the dawn of the 
nineteenth century, the silver coinage of London was 
not issued by the government, but by the Bank of Eng¬ 
land. Silver coins of the realm were scarce and bankers 
were compelled to supply the shortage of silver by cir¬ 
culating the Spanish real. 

The silver coins thus issued and circulated were the 
Mexican minted reals of various dates. They were 
countermarked by being stamped with the same mark 
that is used for stamping silver plate at Goldsmith’s 
Hall, i. e., a king’s head. In the following year this 
stamp was changed for a small octagon containing the 
king’s head. From reports subsequently rendered, no 
less than 2,300,000 of these countermarked Mexican 
silver coins were circulated in London. 

As the clamor for coin increased, the Bank of Eng¬ 
land, in order to relieve the shortage of silver coinage 
and facilitate local trade, had silver dollars manufac¬ 
tured at Birmingham. Arrangements were made with 
the button factory of Matthew Boulton, Soho, near 
Birmingham, to restamp the Mexican real into a Lon¬ 
don silver dollar without waiting for the aid and con¬ 
sent of Congress. 

The Boulton Button Factory had erected very power- 

47 


4 






48 


SILVER BULLION 


ful stamping machinery, whereby it was proposed hy a 
single operation to efface the original brand or impress 
of the Mexican real and substitute the London brand 
dollar. There was no change in contents of the silver 
bullion; the quantity and quality of the bullion re¬ 
mained the same. This process was most efficiently 
accomplished, but on some coins faint tracings of the 
Spanish impression may be discerned. 

There were two patterns or rather designs re¬ 
stamped upon the disk of silver. It will be noted that 
on one of the silver dollars the illustration and word¬ 
ing upon the obverse and reverse appertain to the Im¬ 
perial Government exclusively, the same as all regal 
minted weights. 

On May 12, 1804, a combination dollar was an¬ 
nounced, having the authoritative impress of the Gov¬ 
ernment on one side and the Bank of England on the 
other. This is the first time in the annals of British 
coinage that such a partnership had been displayed, 
although it was not the last. 

Public comment, writes Mr. Maberly Phillips in his 
most reliable account of the London silver dollar, was 
freely called forth; a coin having a Latin inscription 
on one side and an English inscription on the other 
was a new departure. 

William Cobbett, in one of his political tracts writ¬ 
ten while he was a prisoner in Newgate, in his sarcastic 
manner remarks upon the “arms” of the Bank of Eng¬ 
land. “What arms the bank may have, or how it be¬ 
came entitled to any arms at all, or whether arms ought 
to be held in esteem after having been bestowed, are 
questions worthy to be discussed.” 

The notice that heralded the appearance of the new 
silver dollar stated that it was expedient to withdraw 
the countermarked Spanish reals and the issue of the 


SILVER BULLION 


49 


new silver dollar was commenced on May 21, 1804. 
This silver dollar contained 416 grains of standard 
silver bullion, or 377 grains of fine silver. The London 
price of silver bullion was fixed by this dollar at $1.27 
per ounce. 

From 1804 to 1811 no new silver coinage made its 
appearance except the issues of the Bank of England. 
A report of the Bank of England, February 9, 1810, 
informs us that the issue of silver dollars, 1804, 
amounted to 1,409,000. 

Other silver minted by Matthew Boulton for the 
Bank of England brings the grand total to 2,482,000. 
More silver dollars were coined by Boulton in his but¬ 
ton factory, Birmingham, without the aid or the con¬ 
sent of Congress than were coined in the United States 
Mint in the first sixty years of its existence. 

The use of a trade name like the word “dollar” 
affixed to a weight of silver bullion seems to have been 
the common property of the financial world, regard¬ 
less of the quantity or quality of the silver contained 
in the coin. 

In selecting the name “dollar” for the silver unit 
issued from the United States Mint, Congress acquired 
no exclusive right to its use, nor can any nation, cor¬ 
poration, or individual be excluded from the use of 
this trade term “dollar” under which his silver bullion 
may be circulated. 

Many readers on finance have been influenced in 
their opinions on coinage by the clap-trap about “Coin¬ 
age being a prerogative of sovereignty,” yet these 
British Bank dollars were coined by a private corpora¬ 
tion, Boulton, in his button factory, Soho, Birmingham. 

There are very few firms or corporations in the 
commercial world, especially those that trade with the 
general public, that have failed to protect their name 


50 


SILVER BULLION 


and reputation by not marking or stamping some 
special brand on the goods and merchandise which 
they manufacture and which they desire to be iden¬ 
tified. 

Coinage, or stamping a name, a mark, or a label 
on the silver bullion, is merely a handy way of telling 
the general public the name of the manufacturer. The 
label tells who is responsible for the quantity and 
quality of the metal, as well as a mark of identification 
which distinguishes the bullion of one trader from 
the similar bullion of others. In other words, the 
authorized government label for the origin, weight 
and quality of the silver bullion. 

If priority in the use of a name reflects ownership, 
Congress, in justice to the original owner, should have 
been required to distinguish the name on the United 
States dollar from the name on the British dollar 
by bracketing or associating with the word dollar in 
all United States Coinage Laws the statement, “This 
dollar is not named by the original manufacturer of 
silver dollars, or by its successor.” 

In China we next hear of the dollar on its mundi- 
vagant tour. As the London bankers’ Chinese dollar 
will be of special interest to the producer and pur¬ 
veyors of silver bullion, as well as merchants interested 
in export trade to China and the Far East, we shall 
devote the next chapter to the subject. 


CHAPTER XI 


Silver Dollar—London Bankers, 1864 
HINA, the great Silver Empire of the Far East, 



the coming battleground for financial and com¬ 
mercial supremacy in the export trade of the world. 

The Far East holds the largest part of the world’s 
population and its trade potentialities are illimitable. 
With the conclusion of the Chino-Japanese War, in 
1895, a new era opened in China with its 400,000,000 
of population, and an area greater than the area of 
the United States. 

Silver bullion is the one dominant factor that con¬ 
trols all commercial transactions in China. To do busi¬ 
ness in China it is necessary to have silver bullion. 
Silver bullion is, and will be, the principal monetary 
merchandise handled by Chinese merchants. 

Silver bullion is acceptable in all commercial, busi¬ 
ness and trading transactions, and the Chinese mer¬ 
chant is far more willing to barter his produce and 
products for silver bullion than any other monetary 
merchandise. 

London bankers that furnish the silver bullion to 
finance the British trade with China have been well 
aware of these facts for the last half century. As early 
as 1854, the Hongkong colony of London bankers dis¬ 
cussed and planned to extend the “sphere of British 
influence” in the Far East by establishing a local mint 
to coin British dollars. Allow me to interpolate a little 
history. 

In 1841 the island of Hongkong, then described as 
a mere barren rock sparsely inhabited by fishermen, 


51 


52 


SILVER BULLION 


was ceded by China to Great Britain. Hongkong lies 
at the mouth of the Canton or Pearl River, eighty-five 
miles south of Canton. The capital of the island is 
officially known as Victoria, but commonly called 
Hongkong. 

At the date of the cession of Hongkong, the Chinese 
merchants, who are peculiar in their choice of weights 
of silver bullion, accustomed to the use of small bars 
of bullion in local and retail trade, had come to accept 
for payment in commercial transactions the Spanish 
real, or as it was more popularly known in story and 
romance, “The piece of eight.” 

Those who had given the trade of China even a 
cursory study were well acquainted with the singular 
preference which the Chinese people always had shown 
for the old Carolus real. This preference of the Chinese 
for this special brand on 377 grains of pure silver had 
led to the collection of reals from every port in the 
world for the China market. British trade in China, 
therefore, was handicapped by the fact that with a 
constantly increasing demand for the Spanish branded 
coin, the supply on the market was rapidly becoming 
exhausted. 

A seeming solution of this growing and increasing 
difficulty was discovered by the establishment of a 
mint near Canton for the manufacture of the Carolus 
pillar real of a date 1778. Native workmen with Lon¬ 
don dies and other appliances were employed. 

No doubt it was a fraud to pirate the trademark 
of the King of Spain, regardless of the fact that the 
quantity and the quality of silver bullion were identical 
in every respect. The native or pirated real was an 
exact facsimile of the Spanish real, in weight, fineness 
and brand. 

But this mint proved a failure. The greed for profit 


SILVER BULLION 


53 


led the officials to debase the coin until coins were 
issued six parts silver, four parts alloy. 

The keen eye of the Chinese shroff, who is the 
native assayer, was alive to the distinction, and the 
shroffs take the debased real at a discount correspond¬ 
ing to the actual weight of pure silver in the coin. 

In 1824 Mexico became a republic and the real was 
succeeded by the peso, which soon began to make its 
appearance on the silver-sanded shores of China in 
the effort to satisfy the demand for silver bullion. 

The cry of the Chinese merchant was for more silver 
and it mattered not whether the bullion was coined or 
uncoined. The Mexican peso, the lineal descendant 
and chief existing representative of the “old piece of 
eight,” became one of the current silver weights in the 
Hongkong market. 

As years rolled by the peso became very popular, 
and although many competitors have appeared none 
have succeeded in displacing it. 

On March 29, 1842, Sir Henry Pottinger, plenipoten¬ 
tiary and chief superintendent of the trade of British 
subjects in China, issued a proclamation prescribing 
that for bazaar purchases but not for mercantile trans¬ 
actions, the real, the peso, and the East India Com¬ 
pany’s rupees were to be lawful tender in contracts 
calling for silver payments. 

One month later, April 27, 1842, Sir Henry issued 
a further proclamation making “Mexican pesos” and 
other republican dollars the standard in all govern¬ 
ment and mercantile transactions at Hongkong. 

What the term “Republican dollars” intended to in¬ 
clude is nowhere defined. 

These two proclamations established the peso as 
the sole standard silver weight at Hongkong. British 
merchants in London, with Hongkong connections or 


54 


SILVER BULLION 


agencies, had striven for many years to introduce 
British silver dollars into circulation in Hongkong, con¬ 
sequently they opposed this system that excluded 
British coins from circulating in a British colony. 

Their prestige and their influence was strong enough 
to have both proclamations revoked and an Order in 
Council was issued November 28, 1844, establishing 
British silver coins as the nominal standard. The pro¬ 
visions of this “Order” were never carried out and the 
British coin denominations of pounds, shillings and 
pence were never introduced to the mercantile busi¬ 
ness of Hongkong. 

It must be borne in mind that all accounts in Hong¬ 
kong are kept in “silver dollars,” and the sole and only 
silver weight both at Hongkong and at all open ports 
continued to be the Mexican peso, weighing in Hong¬ 
kong 1,000 pesos to 717 taels, i. e., nearly 416 grains 
standard silver per peso—377 grains pure. 

Orders in council, proclamations and court decisions 
followed in rapid succession. The coinage confusion 
was increased by the Colonial Chief Justice. The Chief 
Justice decreed, that, when contracts were made in 
dollars , payment must be made in such coin and not 
in those specified in the Queen’s proclamation. 

In 1853 the minted weights of silver circulated in 
Hongkong were the peso, the rupee and the real, with 
all accounts recorded in dollars. True, a small amount 
of silver dollars coined in London and shipped to China 
circulated, but a “dollar” of the financial lingua franca 
was the peso, and the decision of the Chief Justice 
established the peso, alias the dollar, containing 377 
grains of pure silver as the weight standard both for 
official and mercantile transactions in Hongkong. 

In 1861, when the pillar, or Spanish real, had be¬ 
come scarce and the supply of pesos was limited, nego- 





SILVER BULLION 


55 


tiations were opened by Sir Hercules Robinson, then 
Governor of Hongkong, for a revision of the silver 
coinage. 

By a Royal Proclamation, under Order in Council 
January 9, 1863, all existing proclamations were re¬ 
pealed, and the Mexican pesos, or other “silver dollars” 
of equal weight as authorized from time to time, was 
made the only unlimited tender. 

At this time Rritish silver dollars coined in London 
were introduced to the Hongkong merchants. 

The silver dollar of 1863 weighed 419.052 grains, 
.900 fine and contained 377.15 grains of pure silver. 

This division of the troy ounce prices silver bullion 
at $15.27 per pound or $1.27 per ounce. 

Such were monetary conditions in Hongkong when 
Rritish bankers, who were the pioneers in early Chinese 
trade, undertook to carve fame and fortune from the 
Celestial Empire, extend the “sphere of Rritish in¬ 
fluence,” and establish a mint in China at Hongkong 
to coin London silver dollars, without waiting for the 
aid or the consent of Congress or a diarrhea of words 
from a monetary conference. 

Hongkong merchants had suggested that a silver 
dollar might be coined at Hongkong of the exact weight 
and quality of the Carolus real or the Mexican peso, 
which would be received in commercial transactions 
and soon work its way into popular use. 

The silver dollar could be minted cheaper than it 
could be imported, and still leave a profit for the 
bankers. This silver dollar would also be most useful 
in Singapore and the Straits Settlements where there 
were many Chinese merchants. 

The desire of the Hongkong merchants was finally 
realized; machinery for a mint was bought in London 
at a cost of $75,000. The mint was opened with much 











56 SILVER BULLION 

eclat on May 7, 1866. The standard coin issued at this 
Hongkong mint was the silver dollar, weight 416 grains, 
.900 fine, and contained 374.4 grains of fine silver bul¬ 
lion, 2.7 grains less than the dollar of 1864 minted in 
London. 

All went merry as a marriage bell and great things 
were expected from the new mint and the new silver 
dollar. 

In order to provide a circulation for the Hongkong 
dollar in the Straits Settlements, where the rupee and 
the peso were the principal weights of silver used in 
business transactions, an ordinance was passed in 1867 
repealing all laws which allowed or permitted the 
rupee or other coins of India to be tendered in pay¬ 
ment for silver obligations, and declaring that after 
April, 1867, “The silver dollar issued from the mint 
at Hongkong, the Spanish real, and the peso shall be 
the only tender for silver obligations in the Straits 
Settlements.” 

This law was intended to replace the “rupee,” a 
British coin, with the corporation silver dollar issued 
by the London bankers from their mint at Hongkong. 

But regardless of the prestige of the Hongkong 
banker, the pedantry of the British monetary experts, 
plus the special privileges conferred on the Hongkong 
dollar, both mint and dollar were a failure. The 
Chinese on the mainland refused to accept the new 
dollar. 

Daunted by the reception of the new dollar by the 
Chinese, and unwilling that the “sphere of British in¬ 
fluence” should be extended at their expense, plus the 
additional cost of educating the Chinese merchant into 
the use of the British brand on a weight of silver bullion 
in preference to the brand on the “old Carolus real,” 
the mint was closed in 1868, two years after it was 




SILVER BULLION 


57 


opened. The machinery was sold to the Japanese Gov¬ 
ernment who established a mint at Osaka. 

Total output of the Hongkong mint was 2,100,000 
dollars besides minor coinage. The price or mint divi¬ 
sion of an ounce of silver bullion according to this 
dollar was $1.28 per ounce or $15.38 per pound. 

As little as the Chinese knew of the elementary and 
fundamental principles of coinage, the London hanker 
knew less and his agent in Hongkong knew the least. 

For more than a century the Chinese had become 
familiar with the brand or symbol on the silver Carolus 
real. The principal use for a brand or device on a disk 
of silver bullion consists in advertising the fact of the 
origin as well as indicating the quantity and quality 
of the bullion. The fabricator of the disk of silver 
bullion guarantees by the symbol or label that the con¬ 
tents shall be invariable and that the bullion can be 
received with the utmost faith and reliance. 

The reputation that had been secured through 
acquainting the Chinese merchants with the reliability 
of the silver contents of the “real” in commercial trans¬ 
actions gained for the Spanish piece of silver the con¬ 
fidence and patronage of the Chinese merchants. 

Consequently, the notion is absurd and ridiculous 
for any one to assume that confidence in the real could 
be transferred simply by the introduction of silver 
bullion with an unknown brand. The Chinese neither 
recognized nor remembered the name of the Spanish 
weight, but they are extraordinarily fastidious in their 
choice of a disk of silver bullion according to symbols 
or labels on the coins, i. e., mint brands. 

The brand on the bankers’ dollar of Hongkong was 
a stranger and had the stranger’s handicap to overcome 
in gaining confidence. Once the symbol or brand on 




58 


SILVER BULLION 


a disk of silver bullion becomes known it saves the time 
and trouble of verification of the quantity and quality. 

People in their commercial cash transactions do not 
have the time or appliance to assay all coins that are 
tendered in business, nor do they always know the 
changes that are made in the weight or fineness of the 
coins, hence it is that a familiar symbol or brand in¬ 
duces the acceptance of a recognized mark or device. 

The weight and quality of the Carolus real and the 
real of Ferdinand IV were identical, the Mexican peso 
weighed more, yet the ancient brand on the Carolus 
real commanded a premium ranging from 4 to 15 per 
cent. Such is custom. The same in Chicago as in 
China. 

The circulation of and the confidence in a branded 
and well advertised disk of silver bullion that has 
secured the good will and patronage of the public 
may be changed by persistent and insistent advertising. 

Silver producers may study these facts to their 
profit. 

The closing of the Hongkong mint was a severe 
blow to the extension of British prestige in China via 
the branding of silver bullion. That the experiment 
would have succeeded, if persevered in for a longer 
time by any one familiar with the elementary principles 
of coinage, is indicated by the fact that silver bullion 
identical in weight and name were subsequently cir¬ 
culated and were a marked success. 


CHAPTER XII 


Silver Dollar—London Bankers, 1876 


'^NOTWITHSTANDING the failure of the Hongkong 
Bankers’ Mint, the subject of a silver dollar for 
circulation in China occupied the time and the atten¬ 
tion of many London merchants and bankers trans¬ 
acting business in Hongkong and Shanghai. 

In the fall of 1876 the Shanghai Chamber of Com¬ 
merce resolved to memorialize the Chinese Imperial 
Government at Peking for the establishment of a mint 
to issue silver dollars and minor weights. 

It was not for the convenience of the Chinese mer¬ 
chants that the question was proposed, but as a measure 
to facilitate the business of the London importers in 
the treaty ports of China. 

A circular outlining the proposition was sent from 
Shanghai to the Hongkong Chamber of Commerce. A 
holy howl of horror pierced the heavens when the 
Hongkong bankers heard that the Chinese Imperial 
Government should be identified with the coinage of 
silver dollars without waiting for the aid and the con¬ 
sent of London. 

A public meeting of the Hongkong Chamber of 
Commerce was held in the City Hall, November 2, 1876, 
for the purpose of discussing the Shanghai circular 
relating to the establishment of a Chinese silver mint 
by the Imperial Chinese Government. 

Hon. P. Byric occupied the chair, and asked some 
of the managers of banks who were present to give 
their opinion of the subject. 

Mr. H. H. Nelson (Chartered Bank of India and 

59 


60 


SILVER BULLION 


China) stated, at the present time (1876) there are 
some active measures being taken with the view of 
inducing the British Government to coin silver dollars. 
British interests in these parts of the world are very 
great, and I think that a silver dollar would probably 
be a success. 

A “dollar” issued from a British mint would com¬ 
mand the confidence of everyone having anything to 
do with it and I would myself infinitely prefer to see 
a dollar issued from a British mint brought into the 
Far East, and if possible I would get the Government 
of China to commend that coinage to the natives of 
the country. 

Under the circumstances I would be more inclined, 
at any rate for the present, to discourage the estab¬ 
lishment of such a mint as is proposed. I would en¬ 
deavor to get a British dollar coined and make it a 
current dollar here. 

Mr. Granville Sharpe next addressed the meeting. 
We got a sickening of the Hongkong mint, at the 
hastiness and extravagance of its inception, and the 
precipitancy with which it was closed. 

We put the Hongkong mint out of mind as an un¬ 
pleasant recollection, and now it is brought to mind 
by the inquiries of our brethren in Shanghai. 

We are indebted to the Shanghai Chamber for the 
opportunity of expressing an opinion on this subject 
of a mint operated by the Chinese Imperial Govern¬ 
ment, a mint weight unit, and what minor weights 
should he adopted for a coinage system. 

The only coin of Shanghai is the Mexican peso. 
Whilst the minting of other nations has improved, the 
coinage of Mexico has deteriorated in quality of execu¬ 
tion year by year. 

The silver coinage of China is the dollar and the 




SILVER BULLION 


61 


dollar only. The people of China have heen accus¬ 
tomed to the silver dollar from the first beginning of 
trade with China. 

In common with a large section of the English- 
speaking race, the Chinese merchants know its use and 
appreciate its power. As to the inquiry of the Shanghai 
Chamber “whether the coinage should be for the whole 
of China or restricted to the treaty ports,” it would 
appear that this matter is dependent upon the accep¬ 
tance of the coinage by the Chinese people rather than 
upon the views of foreigners upon the subject. 

Some may be surprised, whilst others will be quite 
prepared for the suggestion of reopening of the mint 
at Hongkong. It would be easy to account for its 
previous failure. The Hongkong mint, like some other 
projects of the administration of the time (1866), was 
too magnificent in its conception and needlessly costly 
in its management and expensive in its workings. 

The closing of the Hongkong mint was almost the 
only error in the long, vigorous and most importantly 
beneficial administration of Sir R. MacDonnell. 

Many bankers are familiar with the fact that 17 per 
cent can be made on bullion remittances. We have the 
highest sanction for the political influence of a silver 
coinage, and for the validity of those rights which are 
tacitly admitted in its acceptance by a nation. 

“Whose is this image and superscription?” may be 
asked by millions in the south of China. What should 
be the answer? “The representative of the British Gov¬ 
ernment.” And by whom should this be done more 
or so suitably as by the British Government. 

After Mr. Granville Sharpe had concluded his re¬ 
marks and as no other banker desired to address the 
meeting, the chairman put the following resolution be¬ 
fore the meeting: 










62 


SILVER BULLION 


“That this chamber is of opinion that a coinage of 
a tael, of which a dollar would be just three-fourths, 
would be the most suitable standard weight for China.” 

The chairman suggested, however, an amendment 
to this resolution. It could be put in this form: 

“That this chamber declines to give an opinion 
upon the scheme suggested by the Shanghai Chamber 
of Commerce so long as the intention is that such silver 
coinage is to be issued by the Chinese Imperial Govern¬ 
ment.” 

The meeting adjourned after adopting the follow¬ 
ing amendment: 

“Under present circumstances this chamber does 
not consider it to be advisable that any recommenda¬ 
tion should go forth from them requiring a government 
mint to be established by or under the authority of 
the Chinese Government for the issuing of silver dollars 
to be legal coinage in the parts open to foreign trade 
and commerce.” So much for the meeting. 

In all this cheap claptrap the British Government 
means the London banker. The British Government 
never was interested in any proposition relating to the 
coinage of silver dollars for the Far East until 1903. 


CHAPTER XIII 


Silver Dollar—London Bankers, 1895 
JL silver bullion, or very near all bullion used in 



-*■ ^ commercial transactions in China, passes through 
the hands of the bullion dealers of London who are 
merely agents for the banking corporations of India 
and China. 

In the early part of 1886, the dollar weight of the 
Chinese ports occupied the time and attention of both 
Hongkong and British merchants. 

Extraordinary premiums which the Mexican peso 
had attained in the London market during the fall of 
1885 forced upon the attention of the London banker 
and merchant the unsatisfactory state of the coined 
silver circulating in the British colonial settlement of 
Hongkong and the Far East. The standard weight for 
mercantile transactions was the dollar , with no British- 
made dollar in circulation. The merchants were de¬ 
pendent on Mexico for their silver coinage. 

British merchants in the Far East claimed that the 
Mexican peso was badly minted, inartistic and of un¬ 
certain weight. When to these disadvantages was 
added the fact that the peso commands a premium 
sometimes as high as 4% per cent, it was high time to 
consider whether it would not be a desirable time to 
substitute a British dollar in place of the Mexican peso. 

It was certainly not too much to expect that in our 
territory a British coin would be preferred to a Mexican. 
There were many reasons to believe that a British dol¬ 
lar would generally attain a large circulation, and 
would at some time tend to facilitate and promote 


63 


5 



64 


SILVER BULLION 


trade, and the Colonial office would do well to give the 
matter their attention and consideration. 

The merchants of Hongkong and the Far East con¬ 
tinued their agitation for a British dollar; but not until 
1895, nearly thirty years after the first attempt to coin 
British dollars in Hongkong, could the Colonial office 
be persuaded to make the attempt. An order in coun¬ 
cil, February 2, 1895, authorized the mints of Bombay 
and Calcutta to strike dollar pieces for any banker or 
merchant who might require them without waiting for 
the aid and consent of Congress. 

The new dollars were to have an entire new label 
or brand, and as regards weight and fineness they were 
to be modeled upon the old Hongkong dollar of 1866, 
and a uniform charge of 1% for mintage, which was 
afterwards increased to 2% from December, 1903. 

Two of the largest London banks guaranteed the 
experiment by agreeing to take a minimum coinage of 
5,000,000 dollars annually until December, 1903. It was 
hoped that the new silver dollar would command a 
wide circulation, not only in Hongkong and the Straits 
Settlements, but also on account of England’s wide 
trade relations in countries not under the British crown. 
Et mirabile dictn this London silver dollar was not cir¬ 
culated in the United States while waiting for the aid 
and consent of Congress. 

The new silver dollar was primarily intended for 
circulation in Hongkong, but in order to pave the way 
for the introduction and circulation of this 416 grains 
of standard silver among the Chinese merchants of 
the Straits Settlements an embargo was ordered against 
all other weights of silver bullion save silver bullion 
that was branded by the Bombay mint for the London 
bankers. The corporation branded silver bullion was 



SILVER BULLION 


65 


once more to have a monopoly in Straits Settlements 
commercial transactions. 

An Order in Council was passed October 21, 1890, 
repealing all previous laws with reference to the brands 
on the weights of silver bullion that could he tendered 
by law in payment for commercial silver obligations. 
It must be borne in mind that all commercial obliga¬ 
tions were silver obligations. 

Subsequently two “Orders in Council” relative to 
the coinage circulating in the Straits Settlements were 
passed under dates of February 2,1895, and October 20, 
1898. In commercial transactions payable in dollars, 
these two “Orders” taken together prohibited the re¬ 
ceiving of any silver bullion that was branded “Amer¬ 
ican Trade Dollar,” “Japanese Trade Dollar,” or silver 
bullion that was branded “Japanese Yen,” and the 
“Orders” declared that the only branded disks of silver 
bullion that would be received in payment of dollar 
obligations were the disks of silver bullion branded 
“Hongkong Dollar” and the disk of silver bullion 
branded “Mexican Peso.” 

The fact that these “Orders” were passed is prima 
facie evidence that any and all commercial silver obli¬ 
gations could be paid and cancelled by the delivery of 
coined silver bullion regardless of the label, the sym¬ 
bol, or the place of origin. 

If these facts were not true, why place a boycott on 
the “American Trade Dollar” and the “Japanese Yen”? 
Why this special privilege for the corporation dollar? 
Why special privileges for American mined silver bul¬ 
lion branded at Bombay and the “boycott” for Amer¬ 
ican mined silver branded at the United States Mint? 

The right of certifying the contents of a disk of 
silver bullion has been claimed as a prerogative in¬ 
herent in the state, but well may it he said that this 






66 


SILVER BULLION 


doctrine belongs to coinage principles long since rele¬ 
gated to the junk pile. 

The corporation silver dollar of Hongkong was 
stamped by the Royal Branch Mint at Bombay for a 
private corporation. Manufactured and stamped at 
a cost of 1 cent each, or $1.00 for manufacturing 100 
dollars. This cost was subsequently raised to $2.00 for 
manufacturing 100 silver dollars. 

Congress authorizes the United States Mint to pay 
99 cents an ounce for silver and to charge 23 cents for 
manufacturing and certifying one dollar for the silver 
producer. In other words, 37,125 grains of fine silver 
bullion can always be manufactured into 100 dollars. 
When the silver producer delivers 37,125 grains of fine 
silver bullion to the mint, the bullion is manufactured 
into 100 dollars; 76 of the manufactured dollars and 
57 cents are returned to the silver producer, while the 
mint retains 23 dollars and 43 cents. The silver pro¬ 
ducer is taxed 23 cents for manufacturing and brand¬ 
ing each silver dollar in direct violation of a statute 
that provides for the performance of this function at 
cost. 

The silver producer is taxed $23.00 for the privilege 
of having 59 43/100 ounces of silver bullion manufac¬ 
tured and branded at a public factory. Twenty-three 
dollars per 100 dollars is the tax levied on the silver 
producer with the aid and consent of Congress, while 
nursing the delusion that the London bullion broker 
will consent to pay $1.29 per ounce for silver bullion 
that can be procured for 62 or 63 cents an ounce, 
shipped to Bombay or China and manufactured into 
dollars for 2 cents apiece and sold at a profit of 100%. 

These facts may percolate the prejudice of the silver 
producer for facts that clash with current opinions on 


SILVER BULLION 


67 


the subject of coinage, yet a little study will result in 
greater profit from the sale of silver bullion. 

But let us finish our account of the corporation sil¬ 
ver dollar of Hongkong. The sale and circulation of 
the Hongkong silver dollar proved a great success. The 
following data will verify the fact that private cor¬ 
porations are capable of putting as good a coin into 
circulation as your hired man—alias the government. 

Total amount of dollars coined at Bombay Mint 
from 1895 to January 1, 1915, were as follows: 

1895 to 1904 inclusive... 152,178,586 silver dollars 
1905 to 1914 inclusive... 65,681,719 silver dollars 

i. . p- — 

Total. 217,860,285 silver dollars 

Minor silver coinage.... 23,000,000 

Grand total .$240,860,285 

Almost 200,000,000 ounces of silver bullion sold by 
the silver producer at a loss ranging from 10 to 60%. 
All this silver bullion coined into standard silver dol¬ 
lars without waiting for the aid and consent of Con¬ 
gress. 

Leaving the Hongkong or London bankers’ silver 
dollar, let us review another British silver dollar—a 
silver dollar that reflects the greed of the royal preroga¬ 
tive of profit from coinage. 









CHAPTER XIV 


Silver Dollar—British Government, 1903 

S ILVER bullion is the only monetary metal used in 
commercial transactions in the Straits Settlements, 
a British colony composed of Singapore, Penang, 
Malacca and their dependencies. Singapore is in the 
midst of the territory identified with Java, Sumatra 
and Borneo. 

In 1903 there was coined at the Bombay Mint a new 
British silver dollar, officially and regally known as 
the Straits Settlements silver dollar. This silver dollar 
was of the same weight and fineness as the corpora¬ 
tion or Hongkong silver dollar, viz., 416 grains, .900 
fine, and contained 374.4 grains of pure silver. 

This 1903 silver dollar was fabricated at the Bom¬ 
bay Mint by order of the King of England, as per Order 
in Council, without waiting for the aid and the consent 
of Congress. 

On June 25, 1903, at the Court of Buckingham 
Palace, the following law was enacted and ordained: 

Now, therefore, we, by and with the advice of 
Our Privy Council, and by virtue of all powers 
vested in US in that behalf, do hereby ordain and 
enact as follows: 

1-(1) A Straits Settlements Dollar shall be coined 
under the direction of the Master of Our Mint, or 
at one of Our Mints in British India, and be of 
metal, weight and fineness specified in the schedule. 

On the reverse impression of the coin there shall 
be a scroll containing the Chinese characters for 
“ONE DOLLAR,” while the corresponding Malay 

68 


SILVER BULLION 


69 


characters shall he contained in the quarters to the 
right and left. The words “STRAITS SETTLE¬ 
MENTS” shall be inscribed above and the words 
“ONE DOLLAR” and the date below the scroll. 

Schedule 1903. 

Metal Fineness Standard Weight 
Silver .900 .416 

On October 2, 1903, there were issued, under 
authority of “The coin imports and export ordinance, 
1903,” two Orders in Council, the one prohibited after 
October, 1903, the importation of the Mexican peso and 
the Hongkong bankers’ or corporation dollar into the 
Straits Settlements; the second order prohibited the 
exportation from the colony of the regal silver dollar 
after the same date. 

The two orders were supposed to bar the Hongkong 
corporation dollar from circulating in the Settlements, 
create a monopoly for the regal silver dollar and trans¬ 
fer some of the profits from the minting of silver bul¬ 
lion from the Hongkong corporation to the coffers of 
the king. -j- > | : 

The profits from minting and circulating the Hong¬ 
kong or corporation dollar were the tribute levied on 
the silver producer and collected by the London coin¬ 
ing corporations, with the asininity and the consent of 
Congress. 

The profits from the manufacture of the Straits 
Settlements silver dollar were the perquisite of the 
king. 

The reader must keep in mind the distinction be¬ 
tween the two “silver dollars,” both coined at the Rom- 
bay Mint, and both dollars of the same weight and fine¬ 
ness. : 1 f- I 

The bank or Hongkong silver dollar is a corporation 


70 


SILVER BULLION 


dollar; the Straits Settlements silver dollar is a regal 
dollar, i. e., controlled by the king. 

From 1903 to November, 1904, 35,400,000 of these 
Settlements silver dollars were manufactured at the 
Bombay Mint, without waiting for the aid or the con¬ 
sent of Congress or an international monetary con¬ 
ference. 

The silver bullion for the minting of the Straits 
Settlements silver dollar was procured by melting the 
brand from the peso and the corporation dollar. 

By the end of 1904 the bulk of the corporation dol¬ 
lars and the Mexican pesos had been melted and re¬ 
branded Straits Settlements dollars. 

On August 31, 1904, the Governor of the Colonies 
issued an order removing the tender privileges* of the 
corporation silver dollar and the Mexican peso, and 
provided that neither the corporation dollar nor the 
peso should thenceforward be receivable in payment 
of government dues and obligations. 

“Thus,” said the chairman of the Singapore Cham¬ 
ber of Commerce, in his address before that body 
September 22, 1904, “the second important step has 
been smoothly and successfully effected, and there is 
cause for succeeding stages of currency schemes.” 

From the context of these remarks it can be in¬ 
ferred that there was a plan for succeeding stages of 
currency schemes; that the first and second steps had 
been taken and other steps had been planned. 

What were these steps? What were the succeeding 
steps of currency schemes? Had the corporation dol¬ 
lar lost its prestige and was the corporation dollar to 
be succeeded by the regal dollar, with all profits from 
the minting of silver bullion transferred by legislation 
to the king? 

* Privileges granted by Orders in Council of Feb. 2, 1895 and Oct. 
20 , 1898 . 








SILVER BULLION 


71 


On October 22, 1906, His Majesty the King ordered 
that the Straits Settlements “silver dollar” shall remain 
the standard coin of the colony. It was also ordered 
that in the schedule to the order of 1903, “.800” shall 
be substituted for “.900” as the fineness of the Straits 
Settlements dollar. 

Now what did this simple looking order mean? 
What was the object of passing this order? Well, let 
us see. 

The standard weight of the silver dollar, according 
to the 1903 schedule, was 416 grains, .900 fine, 374.4 
fine. Changing the fineness from .900 to .800 reduces 
the fine silver contents of the dollar from 374.4 grains 
to 332.8 grains. The standard unit of weight for silver 
bullion is the troy pound, 5760 grains; one ounce, 480 
grains. 

1903:—One pound of silver bullion at 374.4 fine= 
$15.35 = $1.27 per ounce. 

1906:—One pound of silver bullion at 332.8 fine = 
$17,314= $1.44 per ounce. 

The price of silver raised from $1.27 per ounce 
to $1.44 per ounce. 

What was the price of silver bullion in the United 
States with the aid and the consent of Congress? One 
ounce 60 cents. 

But we have some additional information that may 
interest the silver producers. More laws and more 
profiteering in silver prices without waiting for the 
aid and the consent of Congress. 

The following law was enacted at the Court at 
Buckingham Palace, February 11, 1907: 

Whereas, under the Straits Settlements Act, 
1886, and other powers enabling Him in that be¬ 
half, His Majesty has power to make laws for the 






72 SILVER BULLION 

peace, order and good government of the Colony 
of the Straits Settlements. 

And whereas, by the Straits Settlements Coin¬ 
age Order, 1895, ancl by the Coinage Order of 1903, 
and by the Coinage Order of 1906, provision is 
made with respect to the currency of the Colony 
and it is expedient to make further provision with 
respect thereto. 

Now, therefore, His Majesty, by virtue of all 
powers vested in Him in that behalf, is pleased, 
by and with the advice of the Privy Council, to 
order, and it is hereby ordered as follows: 

The Straits Settlements dollar coined under the 
provisions of the Order of 1903, shall be of the 
metal, weight, and fineness specified in the First 
Schedule of this Order, and that schedule shall by 
proclamation be substituted for the schedule to the 
Order of 1903, and article two of the Order of 1906 
is hereby revoked. 


Schedule 1907. 


Coin 

Metal 

Fineness 

Standard 

Weight 

Least 

Current 

Weight 

Straits Settlements 
Dollar 

Silver 

.900 

312 


308 



After this law was passed in 1907, 7,500,000 Straits 
Settlements Silver dollars standard weight 416 grains 
containing 374.4 grains of fine silver that had been 
minted at Bombay and Calcutta for circulation in the 
colony since 1903, were shipped to London. 

On their arrival in London the dollars were thrown 
into the melting pot and remade into Straits Settle¬ 
ments silver dollars, containing 312 grains of standard 
silver bullion or 280.8 grains of fine silver. From each 
and every 1903 dollar, 95.6 grains of fine silver were 
taken. 

From the 7,500,000 silver dollars received, 11,000,000 























SILVER BULLION 


73 


were manufactured and return, a profit of 4,000,000 
dollars. 

In the argot of the financiers, this is called changing 
the ratio, or fixing the gold price of silver. In ordi¬ 
nary, every day English this is called, “Well, call it 
what you please.” 

As this law of 1907 was for the good government 
and peace of the colony, what did this law do to the 
price of silver bullion? 

Standard weight of dollar 312 grains, .900 fine, make 
the pure silver contents 280.8 grains. One dollar equals 
280.8 grains, 5760 grains, or one pound troy, equals 
$20.50 or $1.70 per ounce. 

Three prices for silver bullion in three years with¬ 
out waiting for the aid and the consent of Congress. 

One pound troy = 5760 grains; 1 ounce, 480 grains. 

1903:—5760 grains of silver bullion, 374.4 fine = 
$15.35 =$1.28 per ounce. 

1906:—5760 grains of silver bullion, 332.8 fine = 
$17.30 = $1.44 per ounce. 

1907:—5760 grains of silver bullion, 280.8 fine = 
$20.51 = $1.70 per ounce. 

The price of silver bullion in the United States is 
fixed by the London silver brokers at 60 cents an ounce 
with the aid and the blatant consent of Congress and 
the fatuity of the silver producer’s attorney. 

Did London ask permission from Congress to coin 
and recoin silver dollars? It did not. 

Did London ask Congress for an international 
monetary congress to brand an eagle or stamp the 
word dollar on a piece of silver bullion? It did not. 

What did it do? Why, it told Congress silver is 
demonetized. But there is no one to blame for this 
condition of affairs except the silver producer himself. 

It is time for the silver producers to organize in 




74 


SILVER BULLION 


order to protect their interests, their profits and their 
products from plunder at home and abroad. 

On December 28, 1913, it was enacted by the rulers 

of the Federated Malay States in council as follows: 

1. This Enactment may be cited as “The Legal 
Tender Enactment, 1913.” 

2. The Straits Settlements Silver Dollar, coined in 
pursuance of the Straits Settlements Order, 
1907, of the Standard specified in the Second 
Schedule, shall be the standard coin of the Fed¬ 
erated Malay States. 

Every contract, sale, payment, bill, note, in¬ 
strument and security for money, and every 
transaction, dealing, matter and thing whatever 
relating to money or involving the payment or 
the liability to pay any money, shall, in the 
absence of expressed agreement to the contrary, 
be held to be made, executed, entered into, done 
and had in the Federated Malay States, accord¬ 
ing to the (Standard Silver Dollar). 

If you desired to pay your silver dollar debts in 
gold this could be done by paying gold stamped at 
the royal mint. No other gold will be accepted. 

The schedule for gold payments 7 sovereigns equals 
60 silver dollars, or in other words, 7 sovereigns 791 
grains of fine gold. Sixty dollars equals 16,840 grains 
of fine silver. One ounce of gold, providing it is 
stamped or branded at a British mint pays an obliga¬ 
tion or debt of 21 ounces of silver. 

Thus far the London dollar. 


CHAPTER XV 


Silver Dollar—Imperial China, 1910 

T HE last silver coin issued under the Empire was 
the Chinese Imperial silver dollar. This silver dol¬ 
lar weighed 414.60 grains troy, 9/10 line, and contained 
373.14 grains of pure silver. The price of a pound of 
silver bullion according to this mint division was $15.43 
a pound, $1.28 per ounce. 

This silver dollar was intended to replace various 
provincial mintage and was to he of uniform pattern, 
weight and fineness throughout the Empire. 

The execution of this silver dollar is far superior 
to that of the provincial coinage. The English words 
“one dollar” here appear for the first time on Chinese 
national coinage , and take the place of the old legend, 
7 MACE AND 2 CANDAREENS. 

On May 24, 1910, the following coinage regulations 
were issued. 

Article 1. The monetary unit of the Ta Ching 
Empire shall he the dollar or yuan. 

Article 2. The different coins shall be as fol¬ 
lows: A one dollar silver coin, a fifty cent piece 
and a ten cent piece. 

The silver dollar will be the standard coin and 
shall weigh .72 of a Kuping* tael, and the fineness 
ninety per cent, amounting to .648 of the Kuping 
tael of pure silver. 

In June, 1911, the Nanking and the Wuchang mints 
began to coin the Imperial silver dollar, without wait¬ 
ing for the aid or the consent of Congress. 


♦ Kuping tael 575.84 grains troy. 

75 



76 


SILVER BULLION 


According to a report from the American consul at 
Nanking, July 27, 1911, the Imperial Mint at Nanking, 
which has been closed for the last three years, has 
recently began minting the new silver dollar which is 
to be the standard dollar for China. According to the 
consul at Nanking the total output of the Nanking Mint 
was 5,950,000 Imperial silver dollars from the time it 
reopened early in 1911, until the Revolution brought 
coinage to a standstill on November 7, 1911. 

All the silver bullion for the silver dollars minted 
at Nanking comes from San Francisco. The Nanking 
Mint has a capacity of 180,000 coins a day and was 
under the supervision of the British Metallurgist, Mr. 
F. M. Wharton. 

In 1912 the American silver producer called an 
ounce 60 cents. The mints of China manufactured the 
same bullion into disks and called an ounce $1.28. 
The American silver producer loses 67 cents on each 
and every ounce sold. Why? Simply because the sil¬ 
ver producer nurses the delusion that Congress is the 
sole factor in the sale of silver bullion, while a solution 
resides with themselves. 

The Chinese Revolution broke out at Wuchang 
October 10, 1911, resulting in the downfall of the Em¬ 
pire and the establishment of the Republic of China. 
The Imperial silver dollar was first circulated during 
the Revolution. Such was the history of the silver 
dollar before the Republic. 


CHAPTER XYI 


Silver Dollar—Republic China, 1912 

"POLITICAL reform started in China after the death 
^ of the Dowager Empress in 1908. In 1910 a national 
assembly met. On October 10, 1911, a rebellion against 
the Manchus broke out and early in 1912 the young 
Emperor abdicated and China was declared a Republic 
February 12, 1912. 

Dr. Sun Yat Sen had been elected provisional Presi¬ 
dent of Southern China, but in order to unify the coun¬ 
try, Dr. Sun generously retired from the presidency in 
favor of Yuan Shih Ivai. Yuan Shih Kai was President 
of the Republic of China from 1912 to 1916, and he died 
suddenly in May, 1916. Yuan Shih Kai was succeeded 
by Li Yuan Hung, the vice-president. President Li 
Yuan Hung resigned in 1917 and was succeeded by Vice- 
President Feng Kui Chang. 

A new president, Hsu Shih Chang, was elected in 
1918 at Peking, but South China refused to recognize 
the new president. In 1920 a revolt in South China 
culminated in the declaration of an independent Re¬ 
public of South China, with a capital at Chungking. 

One of the first financial questions that occupied 
the attention of the Peking Government was the coin¬ 
age of silver bullion. The Peking Government promul¬ 
gated national coinage laws February 27, 1914, fixing 
silver bullion as the standard and making a silver dol¬ 
lar of 72 candareens, .890 fine, the mint weight unit. 
The mint sold the silver dollars to banks, merchants, 
etc., just as a shop sells goods. 

Article 12 of the Coinage Laws of February 27, 1914, 

77 


78 


SILVER BULLION 


provided for the free and unlimited coinage of silver 
dollars subject to a charge of 6 li or 3.48 grains of 
silver bullion for minting or branding each dollar. Six 
li or 3.48 grains of silver is the equivalent of one cent. 

Mint Regulations, Article 12:—When silver bullion 
is presented by individuals for coinage at the mint, the 
Government must consent to give coins at a charge of 
one cent apiece. 

In China one cent apiece was the charge for stamp¬ 
ing 373 grains of silver bullion with a trademark. One 
dollar for manufacturing 100 certified weights was the 
mint charge for converting bar bullion into small 
portable disks. 

What is the mint charge authorized by Congress? 
Ask the silver producer. If you bring 480 grains to the 
mint you receive $1.00. Twenty-nine cents each is the 
profit the silver miner contributes for branding his 
bullion with the lady and the eagle. 

But Mr. Silver Producer, you are not to blame. Are 
there no attorneys in the silver producing states? 
Lawyers! What can be expected, as if caecus iter 
monstra revelit. 

The mints of China up to February, 1918, have 
minted 185,000,000 silver dollars without waiting for 
the aid or the consent of London or the fatuous gab- 
fest of a silver conference. 

One million, five hundred thousand ounces of silver 
is furnished by the silver producer while waiting for 
Congress to enact legislation for the lady and the eagle 
to be stamped on a weight of silver bullion in a United 
States mint. 

Many silver dollars were issued by the Republic of 
China. The first silver dollar of the Republic of China 
offers many departures from previous silver coinage. 

Some of the silver dollars issued weighed only 6 














SILVER BULLION 


79 


mace 4 candareens, 8 li., i. e., 373 grains troy, .890 fine, 
330 grains pure silver. This mint division or price is 
equivalent to $17.45 a troy pound or $1.45 an ounce. 

To-day we see a great change from past conditions. 
The silver dollar of China has come into its own. A 
writer on the British Chamber of Commerce Journal, 
published at Shanghai, estimates that in the six months 
ending October, 1919, the following shipments from 
Shanghai for the minting of silver dollars: 

15,000,000 taels Shanghai to Nanking. 

7,000,000 taels Shanghai to Hankow. 

6,000,000 taels Shanghai to Tientsin. 

28,000,000 taels = 35,000,000 ounces. 

You, Mr. Silver Producer, are told that silver is 
demonitized. 

From Peking, March, 1921, comes the following mes¬ 
sage: A loan of 2,500,000 dollars at 9 per cent by a 
Chinese banking group has been arranged. The pro¬ 
ceeds from this loan will be used to construct a silver 
mint at Shanghai with a daily capacity to coin 500,000 
silver dollars without waiting for the aid and consent 
of Congress. 

Mr. Silver Producer, you will furnish the silver bul¬ 
lion. At what price? At what price will you furnish 
the bullion to mint these silver dollars? 


G 












CHAPTER XVII 


Silver Trade Dollar—Japan, 1877 

J APAN in 1870 made a reform in her coinage. Like 
China, Japan had circulated silver bullion in the 
shape of a domino. Sir Harry Parkes, the agent for 
the London bankers, induced the Japanese to remodel 
their coinage. 

The mint formerly used by the London hankers to 
coin silver dollars at Hongkong had been purchased 
by the Japanese Government, the machinery and coin¬ 
ing pressed moved to and erected at Osaka, one of the 
treaty ports of Japan. 

The Osaka Mint was placed under the management 
of Maj. C. W. Kinder, late Master of the Hongkong 
Mint. New coinage regulations were issued and in 1871 
the “silver yen” and the Japanese “silver trade dollar” 
were introduced to the Far East commercial world. 
The yen purported to be for local circulation while the 
Japanese trade dollar was to circulate in the Chinese 
markets. 

Two years later, July 16, 1873, the United States 
trade dollar was issued from the mint at Philadelphia 
under or by what authority no one seems to know. 
Bankers claimed that the United States silver trade 
dollar would circulate extensively in the markets of 
China and the Far East and soon replace the Mexican 
peso as the silver weight unit for business transactions. 

In due course of time the United States silver trade 
dollar made its appearance in the markets of China. 

The Japanese silver trade dollar weighed 420 grains, 
.900 fine, the United States silver trade dollar weighed 

80 







SILVER BULLION 


81 


the same, the Mexican peso weighed 416 grains and 
contained 377 grains of pure silver. All silver weights 
circulated in the markets of the Far East. 

When the merchants of China received the United 
States trade dollar, or the Japanese trade dollar in 
business transactions, they were placed in the melting 
pot. In May, 1878, the Japanese silver trade dollar was 
made a lawful tender in Japan for silver obligations. 

Total number of 1 yen pieces and silver trade dol¬ 
lars that have been coined since the opening of the 
government mint at Osaka amounts to 165,130,000. 
From 1871 to 1897, inclusive, twenty-six years, the 
Japanese Government has coined 140,000,000 ounces of 
silver bullion. 

In 1897 the coinage of the silver yen was stopped 
at the Osaka mint. 














CHAPTER XVIII 


$6.46 or 5 Dollar Unit of Silver Bullion 

B EFORE we demonstrate to the entire satisfaction 
of silver bullion owners that they possess the free 
and unrestricted right to have their metal coined into 
standard silver dollars, a few remarks in regard to the 
live ounce bar which is authorized to be coined and 
issued from the public factory or mint. 

There is no controversy over the fact that the owners 
of silver bullion possess the right to have five ounce 
bars of silver bullion manufactured at the public assay 
office called the mint. Five ounce bar of silver bullion, 
a synonymous and interchangeable term for $6.46. 

Revised Statutes, Sec. 3518. At the option of 
the owner gold or silver may be cast into bars of 
fine metal, or standard fineness or unparted as he 
may prefer, with a stamp upon the same designat¬ 
ing the weight and fineness, and with such devices 
impressed upon them as may be deemed expedient 
to prevent fraudulent imitation, and no such bars 
shall be issued of less weight than five ounces. 

Under our present coinage laws which govern the 
issue of weights of bullion, no single or individual 
weight unit of gold, known as the dollar, is issued from 
the mint. 

Now, it must be a self-evident proposition that if 
the eagle or ten times the gold weight unit liquidates 
a debt of ten dollars, then the five ounce silver bar, 
certified and stamped at the mint, must liquidate or 
cancel any obligation calling for the payment of $6.46. 

It must be apparent to anyone who has given our 

82 


SILVER BULLION 


83 


argument even a cursory examination, that it is not 
absolutely necessary to have the mint stamp upon the 
bullion, to have the metal recognized as a dollar, any 
stamp or brand will certify the quantity and quality. 

Let us carry this argument a little further. A copper 
mine owner agrees to pay 100 pounds of copper thirty 
days after date. A contract pure and simple. He must 
tender copper; copper is the metal he agreed to deliver. 

Now, no one in the wildest flights of his imagination 
believes that the copper mine owner must tender the 
copper in individual one pound packages. The copper 
mine owner can deliver his copper in any size package 
that suits his convenience. Nor is it necessary to have 
a government stamp upon the copper to indicate its 
quality and quantity. 

Along the same line of argument, an owner of silver 
bullion agrees to deliver 5000 ounces of fine silver thirty 
days after date. A contract pure and simple. Fine 
silver is what he agrees to deliver; fine silver is what 
the contract calls for. How could you tender silver 
illegally under this contract? Impossible. 

The owner of silver bullion is not compelled under 
the term of this contract to have his bullion manufac¬ 
tured into one ounce weights. Nor is it necessary to 
bring the bullion to the mint in order to have the metal 
certified. It is optional with the owner of silver bullion 
to deliver this silver in any size package he may 
select—five ounce packages, five pound packages, or 
fifty pound packages. 

Again, along the same line of argument, an owner 
of silver bullion, or any other person controlling silver 
bullion, agrees to deliver 6464 dollars thirty days after 
date. A contract pure and simple to deliver 5000 ounces 
of fine silver or 312.45 ounces of gold. 

Silver is what you agreed to deliver, with the option 


84 


SILVER BULLION 


of delivering gold. Silver is the metal you can deliver 
to-day, to-morrow and the next day regardless of the 
tongues that have been taught to lisp the lie, that 
silver will wreck the credit of the Republic. 

Optional with the silver owner which weight of 
bullion he delivers. If he elects to deliver silver, we 
fail to find any law or mandate compelling him to 
have his bullion manufactured into packages contain¬ 
ing 412% grains of standard silver. If he desires to 
deliver this bullion in one thousand packages, each 
containing five ounces of silver, no law prevents him. 

He has the unrestricted right to take his bullion 
to the mint and have the metal manufactured into five 
ounce bars, whereby his contract may be fulfilled. 

Should the owner or producer of silver bullion con¬ 
clude to settle this contract calling for the delivery of 
6464 dollars by the payment of five bars of silver bul¬ 
lion each containing 1000 ounces, we fail to find any 
law or act upon the statute books that prevents him, 
nor do we find any act where it is mandatory to have 
the bullion carted to the mint and manufactured into 
weights of any particular size or shape. 

This contract calls for the delivery of a specific 
amount and quality of silver bullion. Silver bullion is 
the commodity agreed to be delivered and the silver 
bullion owner fulfills his contract when he tenders the 
quantity and quality of metal agreed to be delivered, 
regardless of the size or shape of the package by which 
he delivers his metal or by whom the bullion was cer¬ 
tified for its purity and weight. 


CHAPTER XIX 


The Right to Mint Silver Bullion 

T T AS the silver producer the right to have his bullion 
A manufactured into weight units containing 412% 
grains of standard silver free of charge? Has the 
silver producer the right to take his bullion to the 
mint and have the bullion manufactured into a disk 
and the contents certified by a mint stamp? 

In presenting the following facts for the considera¬ 
tion of silver producers, we hope that our deductions 
will be given the study their importance demands. 

There is no doubt that the owners of silver bullion 
possessed the unrestricted privilege to have their metal 
manufactured at the mint into standard silver dollars 
containing 371 % grains of fine silver from the year 
1793 up to the year 1873. 

This is an undisputed fact; no argument necessary 
on that point. 

The Act of February 12, 1873, gave the owners of 
silver bullion the privilege to have their metal manu¬ 
factured into weights containing 420 grains. This 
weight was known as a trade weight or trade dollar. 

The Act of February 28, 1878, restored to the owners 
of silver bullion the privilege to have his bullion manu¬ 
factured into weights containing 412y 2 grains of 
standard silver. Your attention is called to the Act 
of February 28, 1878; study the first part of Section 1 

carefullv. 

%/ 

Revised Compiled Statutes, Section 3513, page 
2346. 

Act of February 28, 1878. 

85 




86 


SILVER BULLION 


I 


To authorize the coinage of the standard silver 
dollar and to restore its legal tender character. 

Be it enacted by the Senate and House of Rep¬ 
resentatives of the United States of America in 
Congress assembled, that there shall be coined, at 
the several mints of the United States, silver dollars 
of the weight of four hundred and twelve and a 
half grains troy of standard silver, as provided in 
the Act of January eighteenth, eighteen hundred 
thirty-seven, on which shall be the devices and 
superscriptions provided by said act; which coin, 
together with all silver dollars heretofore coined 
by the United States, of like weight and fineness, 
shall be a legal tender at their nominal weight, 
for all debts and dues, public and private, except 
where otherwise expressly stipulated in the con¬ 
tract. 

This section stands on the statute books to-day un¬ 
repealed, neither vitiated nor void, and binding upon 
each and every employee of the United States Mint. 

This section, ipso facto, re-enacts and validates 
each and every clause and section of the Law of 
January 18, 1837, in so far as it relates to the coinage 
of silver bullion. 

The mere fact that under a section of the Law of 
February 28, 1878, the Secretary of the Treasury is 
authorized to purchase silver bullion does not confer 
upon that official the sole and exclusive right to manu¬ 
facture silver dollars. 

The Law of January 18, 1837, was a free coinage 
law. No restrictions on anyone having silver bullion 
to be coined into silver dollars. 

Section 14 of the Law of January 18, 1837, de¬ 
clares: Be it further enacted, that gold and silver 
bullion brought to the mint for coinage shall be 
received and coined by the proper officer, for the 
benefit of the depositor. 











SILVER BULLION 


87 


“For the benefit of the depositor,” not for the benefit 
of the Secretary of the Treasury. 

I hear some sapient sciolist shout, “Why, all those 
laws were repealed by the Act of July 14, 1890.” 

Well, let us investigate that point. 

Section 5, Act of July 14, 1890: That so much 
of the Act of February twenty-eight, eighteen 
hundred and seventy-eight, entitled “An Act to 
authorize the coinage of the standard silver dol¬ 
lar and to restore its legal tender qualities,” as 
requires the monthly purchase and coinage of the 
same into silver dollars of not less than two mil¬ 
lion, nor more than four million dollars worth of 
silver bullion, is hereby repealed. 

A little study will enable the reader to perceive that 
this section repeals the purchasing clause only. It 
states very distinctly, “So much of the act that relates 
to the monthly purchase of silver.” 

Nor does the Act of November 1, 1893, restrict the 
free coinage of the standard silver dollar. This act 
simply discontinues the purchasing of silver bullion 
and the issue of treasury notes thereon. 

The Act of February 28, 1878, in so far as it 
authorizes the free coinage of standard silver dollars, 
has not been repealed, annulled or abrogated. 

The Act of November 1, 1893, Chapter 8. An 
act to repeal a part of an act approved July four¬ 
teenth, eighteen hundred and ninety, entitled, “An 
Act directing the purchase of silver bullion and 
the issue of treasury notes thereon, and for other 
purposes.” Be it enacted by the Senate and House 
of Representatives of the United States of America 
in Congress assembled. That so much of the act 
approved July fourteenth, eighteen hundred and 
ninety, entitled “An Act directing the purchase of 
silver bullion and issue of treasury notes thereon, 
and for other purposes,” as directs the Secretary 


88 


SILVER BULLION . 


of the Treasury to purchase from time to time 
silver bullion to the aggregate amount of four mil¬ 
lion five hundred thousand ounces, or so much 
thereof, not exceeding one dollar for three hun¬ 
dred and seventy-one and twenty-five one-hun¬ 
dredths grains of pure silver, and to issue in pay¬ 
ment for such purchases treasury notes of the 
United States, be, and the same is hereby repealed. 

Only the purchasing clause of the Act of July 14, 
1890, repealed, that’s all. 

That Section 1 of the Act of February 28, 1878, 
authorizing the free and unlimited coinage of standard 
silver dollars, has not been repealed, either by the Act 
of November 1, 1893, or by the Act of July 14, 1890, 
is emphasized by the following acts: 

Act of June 13, 1898: 

Sec. 34: That the Secretary of the Treasury is 
hereby authorized and directed to coin into stand¬ 
ard silver dollars as rapidly as the public interest 
may require .... all the silver bullion now in 
the treasury, etc. 

Act of March 14, 1900: 

Sec. 3: That nothing contained in this act shall 
be construed to affect the legal tender quality as 
now provided by law of the silver dollar, or any 
other money coined or issued by the United States. 

“As now provided by law.” What law? 

Very easy to answer that question. Why, the Law 
of February 28, 1878, whereby the standard silver dol¬ 
lar was authorized to be coined and its legal tender 
qualities restored. 

“As now provided by law.” Then that portion or 
section of the law that authorized the free and un¬ 
limited coinage of the standard silver dollar, that sec¬ 
tion of the Act of February 28, 1878, which declares, 
*‘That the standard silver dollar authorized to be 


SILVER BULLION 


89 


issued under this act, together with all silver dollars 
heretofore coined by the United States of like weight 
and fineness, shall be a legal tender at their nominal 
weight, for all debts and dues, public and private, 
except where otherwise expressly stipulated in the 
contract, stands to-day unrepealed, binding upon the 
Director of the Mint, and enforcible in any court of 
competent jurisdiction. 

Any doubt that may remain in your mind that Sec¬ 
tion 1 of the Act of February 28, 1878, is not a lawful 
and valid act, or that it is not enforcible to-day, or that 
it has been repealed, is very easily dissipated by read¬ 
ing Section 5 of the Act of March 14, 1900. 

Act of March 14, 1900: 

Sec. 5: That it shall be the duty of the Secre¬ 
tary of the Treasury, as fast as standard silver 
dollars are coined under the provisions of the Acts 
of July fourteenth, eighteen hundred and ninety, 
and June thirteenth, eighteen hundred and ninety- 
eight, from bullion purchased under the Act of 
July fourteenth, eighteen hundred and ninety to 
retire and cancel an equal amount of treasury 
notes, etc. 

Now, then, it must necessarily follow that if the 
Secretary of the Treasury is authorized by the Act of 
March 14, 1900, to retire treasury notes as fast as silver 
dollars are coined, there must be some law on the 
statute book authorizing and regulating their coinage. 

No standard silver dollars were authorized to be 
coined by the Act of July 14, 1890, or the Act of June 
13, 1898, or the Act of March 14, 1900. 

Useless to argue this point. March 14, 1900, the law 
authorizing the free coinage of standard silver dollars 
had not been repealed. 

The standard silver dollar was authorized to he 
coined by the Act of February 28, 1878, and by no other 




90 


SILVER BULLION 


act, and nowhere in the act do we find any clause, sec¬ 
tion or paragraph that states this law was enacted for 
the exclusive benefit of the Secretary of the Treasury. 

The Act of February 28, 1878, flung back the door 
of the mint to free and unlimited coinage of standard 
dollars. This act extended an invitation to the owners 
of silver bullion to bring their metal to the mint and 
have it coined into standard silver dollars containing 
412% grains of silver and the door stands wide open 
to-day. 

In conclusion, let us bring our argument down to 
date by Section 26 of the “Federal Reserve Act,” 
approved December 23, 1913. 

Sec. 26 : Nothing in this act contained shall be 
construed to repeal the parity provision or pro¬ 
visions contained in an act approved March 14, 
1900. 

Now, one of the provisions of the Act of March 14, 
1900, is contained in Section 3. 

Section Three, which states plainly and clearly 
that nothing in this act shall be construed to affect 
the legal tender quality as now provided by law 
of the silver dollar; consequently, Section One of 
the Act of February 28, 1878, which authorizes the 
coinage of the standard silver dollar of 412% grains 
of silver and restores its legal tender qualities, 
stands to-day upon the statute books, neither null 
nor void, but enforcible, as we have already stated 
in any court of competent jurisdiction. 

All debts or obligations calling for the payment of 
dollars can be cancelled or liquidated by the tender or 
payment of silver bullion, 371% grains of fine silver 
for each dollar agreed or contracted to be delivered, 
regardless of where the silver bullion was mined, 
whether certified by the mint or private assay. 

THE END 







Your Attention, Please. 

READ THE SILVER BULLETIN 


0 meet present conditions in the commercial world, 



J- the Silver Producer must possess a readier compre¬ 
hension of all problems which enter into the Price and 
the Minting of Silver Bullion. 

Our presentation of facts are brief, short and dis¬ 
tinct. Our aim has been to reach the basic and funda¬ 
mental principle that underlies the Price and the Mint¬ 
ing of Silver Bullion. 

Our ideas are frankly and honestly presented and 
will help to clarify the subject of Mintage, as well as 
register definite and lasting impressions on the Price 
of Silver Bullion. 

Impressions on the Mintage, i. e., Price of Silver 
Bullion that will not fail to bring to the attention of 
the Silver Producer important and probably not gen¬ 
erally known facts, facts that will help to restore to the 
Mining Industry the just profits from silver production. 

The subject could not be treated in exhaustive detail 
in a book of this size, but the “ Silver Bulletin” will 
answer all questions for those who wish to pursue 
farther study of the “Metallic Merchandise of the 


World ” 


SPECIAL NOTICE 


P|T*No Question Will Be Answered That Contains 


THE WORD VALUE 


91 













































































































































































































































































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